Capsicum annuum (L.) is one of the essential spices most frequently used in our daily routine and has remarkable ethnobotanical and pharmacological properties. Its fruits are rich in vitamins, minerals, carotenoids, and numerous other phenolic metabolites with a well-known antioxidant activity. Regular consumption of chili fruits may have a positive influence on human health. Therefore, we investigated a commercially available chili fruit powder in the present study, extracting it with 50% ethanol. The dried hydro-ethanolic extract (CAE) was thoroughly analyzed using ultra-high-performance liquid chromatography coupled with high-resolution mass spectrometry (UHPLC–HRMS/MS), and 79 bioactive phenolic constituents were identified. Then, we quantified the main phenolic compounds and found a polyphenol content of 4.725 ± 1.361 mg Eq tannic acid/100 g extract and a flavonoid amount of 1.154 ± 0.044 mg Eq rutin/100 g extract. Phenolic secondary metabolites are known for their dual redox behavior as antioxidants/pro-oxidants, underlying their numerous benefits in health and disease. Thus, the antioxidant potential of CAE was evaluated using three methods; our results could explain the protective effects of chili fruits: IC50DPPH = 1.669 mg/mL, IC50ABTS = 0.200 mg/mL, and EC50FRAP = 0.561 mg/mL. The pro-oxidant potential of phenolic compounds could be a basis for CAE cytotoxicity, investigated in vitro on tumor cell lines and in vivo on Daphnia sp. Results demonstrated the dose- and time-dependent CAE’s cytotoxic activity; the highest antiproliferative activity was recorded on colon (LoVo) and breast (MDA-MB-231) cancer cell lines after 48 h of exposure (IC50 values < 200 µg/mL). In vivo testing on Daphnia sp. reported a potent CAE cytotoxicity after 48 h and embryonic developmental delays. Extensive data analyses support our results, showing a significant correlation between the CAE’s concentration, phenolic compound content, antioxidant activity, exposure time, and the viability rate of different tested cell lines.