This research reports a simple and novel method for the controlled synthesis of cadmium oxide (CdO) and cadmium hydroxide (Cd(OH)2) with different new morphologies in the presence of NaBH4 or LiBH4 as reducing agent, by using κ-carrageenan as a capping/stabilizing agent and potassium bromide as a template. The synthesized products were characterized by x-ray diffraction (XRD) and scanning electron microscopy (SEM). The impacts of reducing agent, reaction atmosphere, and concentration of reducing agent on size and morphology of the particles were discussed. We suggested that chemical etching and Kirkendall effect play a key role in the morphology of particles, and the etch rate depends on reducing agent concentration. It was found that by increasing the concentration of the reducing agent, the intensified etching leads to an increase in the size of the particles. The results show an increase in particle size with decreasing reducing agents power. The various morphologies obtained for CdO and Cd(OH)2 such as hollow cube, macro rod, nanoplate, and macroplate were discussed based on the Kirkendall effect and chemical etching. Finally, the antibacterial activity of the synthesized nanoparticles was screened against Escherichia coli (E. coli) and Staphylococcus aureus (s.aureus). The inhibition zones were ranged from 36–47 mm and 25–47 mm for different morphologies of CdO and Cd(OH)2, respectively. Furthermore, the reactive oxygen species (ROS) production assay in the presence of bacteria was performed. The results did not show any positive result of ROS production.