The current research aimed to study the green synthesis of silver oxide nanoparticles (AgONPs) using Rhynchosia capitata (RC) aqueous extract as a potent reducing and stabilizing agent. The obtained RC-AgONPs were characterized using UV, FT-IR, XRD, DLS, SEM, and EDX to investigate the morphology, size, and elemental composition. The size of the RC-AgONPs was found to be ~ 21.66 nm and an almost uniform distribution was executed by XRD analysis. In vitro studies were performed to reveal biological potential. The AgONPs exhibited efficient DPPH free radical scavenging potential (71.3%), reducing power (63.8 ± 1.77%), and total antioxidant capacity (88.5 ± 4.8%) to estimate their antioxidative power. Antibacterial and antifungal potentials were evaluated using the disc diffusion method against various bacterial and fungal strains, and the zones of inhibition (ZOI) were determined. A brine shrimp cytotoxicity assay was conducted to measure the cytotoxicity potential (LC50: 2.26 μg/mL). In addition, biocompatibility tests were performed to evaluate the biocompatible nature of RC-AgONPs using red blood cells, HEK, and VERO cell lines (< 200 μg/mL). An alpha-amylase inhibition assay was carried out with 67.6% inhibition. Moreover, In vitro, anticancer activity was performed against Hep-2 liver cancer cell lines, and an LC50 value of 45.94 μg/mL was achieved. Overall, the present study has demonstrated that the utilization of R. capitata extract for the biosynthesis of AgONPs offers a cost-effective, eco-friendly, and forthright alternative to traditional approaches for silver nanoparticle synthesis. The RC-AgONPs obtained exhibited significant bioactive properties, positioning them as promising candidates for diverse applications in the spheres of medicine and beyond.