Background: Green chemistry is widely accepted phenomenon to synthesize iron oxide nanoparticles (Fe-NPs) used in several biomedical and technological applications. Metal oxide nanoparticles are useful in biomedical, clearing environmental pollutants, enzyme immobilization, etc., Objectives: The synthesis of Fe-NPs using Sphagneticola trilobata leaf extract using ferric chloride solution and its biological assessment. Materials and Methods: The present study involved the synthesis of Fe-NPs using S. trilobata leaf extract using ferric chloride solution by the co-precipitation method. The synthesized nanoparticles were characterized for Fourier-transform infrared spectroscopy, scanning electron microscopy, powder X-ray diffraction spectroscopy, particle size analysis, and magnetization studies. The nanoparticles were biologically evaluated for microbiological, antioxidant, and in vitro cytotoxicity activity. Results: Magnetic nanoparticles were appeared in dark brown color. The change in color might result due to the presence of polyphenols in S. trilobata leaf extract. The characterization studies confirmed morphology, shape, and size of the nanoparticles. The mean diameter of Fe-NPs and S. trilobata-Fe-NPs was found to be 42.2 ± 2.6 and 62.54 ± 2.01 nm, respectively. Magnetization studies of nanoparticles revealed ferromagnetic behavior with the saturation magnetization at 57 emugm−1. S. trilobata-Fe-NPs showed significant antibacterial action against Staphylococcus aureus and Bacillus subtilis by the well-diffusion method. Antioxidant activity of S. trilobata-Fe-NPs exhibited 65.78% inhibition in comparison with ascorbic acid. The cytotoxicity assay of S. trilobata-Fe-NPs on HCT-15 colon adenocarcinoma cells showed significant anticancer activity (56.44%) cytotoxic inhibition. Conclusion: Green synthesis-mediated S. trilobata-Fe-NPs appeared to produce significant antimicrobial and anticancer potential.