In this article, the influence of the medium refractive index on optical properties of gold nanorods (GNRs) and their surface enhanced Raman spectroscopy application were studied. In particular, GNRs have been applied in biomedical sensors to detect diseases by monitoring the changes in the environment. In this study, the changes in optical properties of GNRs were investigated according to the medium refractive index changes in the cationic surfactant cetyltrimethylammonium bromide (CTAB) during synthesis processes as well as GNR dispersion in different medium refractive indices. For instance, in the solutions with different concentrations of CTAB, GNRs were coated by biomolecules such as PEG, bovine serum albumin (BSA), and glutathione (GSH), which have different refractive indices. The fundamental reason for the change in optical properties of GNRs is also elucidated. GNRs have been used to enhance surface Raman scattering to detect indigo molecules. The results showed that due to the surface plasmon resonance effect, the GNRs could strongly enhance the scattering signal of indigo dyes, with the lowest detectable concentration of up to 10−8 M and with an enhancement coefficient of over 2000 times.