Background: Loss of expertise in Sanskrit language and medicinal plant identification as per ayurvedic texts has resulted in the creation of “Controversial Drugs,” i.e., plants with different botanical identities being used by the same name Launaea pinnatifida Cass. It is one of the species of one such traditional Indian ayurvedic herb known as “Gojihva.” As per the ayurvedic and modern research, Gojihva possesses hepatoprotective, diuretic, galactagogue, and blood-purifying properties. The present study was aimed at bioactivity-guided isolation, characterization, and estimation of a marker compound obtained from L. pinnatifida. Materials and Methods: Fractions were obtained through the successive solvent extraction technique and subjected to in vitro antioxidant and hepatoprotective bioassays which signified that the methanol extract of leaves had significantly better pharmacological activity. Hence, the methanol extract was subjected to further isolation of the active compound. Estimation of the isolated compound was carried out by high-performance liquid chromatography (HPLC) and high-performance thin-layer chromatography fingerprinting. Results: A marker compound was isolated from chloroform:ethyl acetate (90:10) fraction and elucidated to be esculetin based on its spectral analysis (Fourier transform infrared, liquid chromatography–mass spectroscopy, 13C nuclear magnetic resonance, and ultraviolet). The percentage purity and yield of esculetin in methanol extract of leaf fractions was found to be 99.75% and 0.927%, respectively, by HPLC. Conclusion: Esculetin has been reported for the first time in L. pinnatifida. Hence, it can be used as the bioactive marker for this plant. This marker can also be useful in the development of hepatoprotective formulations as well as standardization and quality control of L. pinnatifida formulations.