Understanding the phenomenon of intense photoluminescence in carbon materials such as hydrogenated graphene, graphene nanoribbons, and so forth is at the forefront of investigations. In this study, six different types of hydrogenated graphene (phG) produced from different starting materials were fully characterized in terms of structure and optical spectroscopy. Comprehensive photoluminescence lifetime analyses of phGs were conducted by combining time-correlated single-photon counting with steady-state fluorescence spectroscopy and femtosecond transient absorption spectroscopy. The conclusion drawn from these assays is that graphene islands with diameters in the range from 1.1 to 1.75 nm reveal band gap photoluminescence between 450 and 800 nm. As a complement, phGs were implemented in hybrids with water-soluble electron accepting perylenediimides (PDIs). By virtue of mutual pi-stacking and charge transfer interactions with graphene islands, PDIs assisted in stabilizing aqueous dispersion of phG. Implicit in these ground state interactions is the formation of 300 ps lived charge separated states once photoexcited.