o-Dianisidine dihydrochloride is primarily used as a reagent in chemical laboratories for the detection and quantification of various substances. It is commonly employed in colorimetric assays to measure the presence of peroxides, particularly in biological and environmental samples. The compound reacts with peroxides to produce a colored product, allowing for easy visual or spectrophotometric analysis.

In the field of histology, o-Dianisidine dihydrochloride serves as a staining agent to identify specific cellular components, particularly in the study of blood and tissue samples. It helps in visualizing peroxidase activity, which is useful in diagnosing certain medical conditions.

Additionally, it is used in the synthesis of dyes and pigments, particularly azo dyes, which are widely applied in the textile and printing industries. Its ability to form stable, colored compounds makes it valuable in producing vibrant and long-lasting colors.

In environmental monitoring, this chemical is utilized to detect trace amounts of oxidants such as hydrogen peroxide in water and soil samples. Its sensitivity to specific reactive species makes it a useful tool for ensuring environmental safety and compliance with regulatory standards.