Oxidative stress is an elevated intracellular level of free oxygen radicals that cause lipid peroxidation, protein denaturation, DNA hydroxylation, and apoptosis, ultimately negotiating cells viability. Antioxidants can scavenge such free radicals, thus reducing the oxidative stress and eventually prevent cellular damage. Medicinal plants, fruits, and spices remain the prioritized sources of antioxidants and antimicrobial properties since the time immemorial, but in contrast to plants, microorganisms can be grown at a faster rate under controlled conditions. They are non-toxic, non-carcinogenic, and biodegradable as compared to synthetic antioxidants. Microorganisms including actinomycetes, archaea, bacteria, protozoa, yeast, and fungi are auspicious source of vital bioactive compounds. The list comprises ample of bioactive components from microorganisms. One of them is bacteriocins, which are ribosomally synthesized antimicrobial peptides product of Eurotium sp., Streptomyces parvulus, S. thermophiles, Lactococcus lactis, etc. It has a great potential as next-generation antibiotics targeting the multiple-drug resistant pathogens. Pneumocandins are antifungal lipohexapeptides derived from the fungus Glarea lozoyensis, and inhibit 1,3-β-glucan synthase of the fungal cell wall and act as a precursor for the synthesis of caspofungin. It is widely used against invasive fungal infections and has been recently approved by the FDA. Taxol (paclitaxel), a chemotherapeutic drug derived from the bark of Taxus brevifolia can also be produced by endophytic fungi Taxomyces andreanae and Nodulisporium sylviforme. It is known to inhibit several fungi such as Pythium, Aphanomyces and Phytophthora. Hispidin and its derivate isolated from P. hispidus, reduce inducible nitric oxide synthase (iNOS) expression, obstruct the transcriptional activity of NF-κB, and also decrease the production of reactive oxygen species (ROS) in macrophages. Astaxanthin, known as an “aquatic” carotenoid produced by H. pluvialis, also has excellent ROS quenching activity. This study mainly focuses on fascinating antioxidant and antimicrobial compounds that have been scarcely investigated in microorganisms and discuss the promise and challenges of microorganisms as providers of health benefits.