In the treatment of bacterial contamination, the problem of multi-drug resistance is becoming an increasingly pressing concern. Nanotechnology advancements enable the preparation of metal nanoparticles that can be assembled into complex systems to control bacterial and tumor cell growth. The current work investigates the green production of chitosan functionalized silver nanoparticles (CS/Ag NPs) usingSida acutaand their inhibition efficacy against bacterial pathogens and lung cancer cells (A549). Initially, a brown color formation confirmed the synthesis, and the chemical nature of the synthesized NPs were examined by UV-vis spectroscopy, Fourier transform infrared spectroscopy (FTIR), scanning electron microscopy (SEM) coupled with energy dispersive spectroscopy (EDS), and transmission electron microscopy (TEM). FTIR demonstrated the occurrence of CS andS. acutafunctional groups in the synthesized CS/Ag NPs. The electron microscopy study exhibited CS/Ag NPs with a spherical morphology and size ranges of 6–45 nm, while XRD analysis demonstrated the crystallinity of Ag NPs. Further, the bacterial inhibition property of CS/Ag NPs was examined againstK. pneumoniaeandS. aureus, which showed clear inhibition zones at different concentrations. In addition, the antibacterial properties were further confirmed by a fluorescent AO/EtBr staining technique. Furthermore, prepared CS/Ag NPs exhibited a potential anti-cancer character against a human lung cancer cell line (A549). In conclusion, our findings revealed that the produced CS/Ag NPs could be used as an excellent inhibitory material in industrial and clinical sectors.