Capsicum annuum L., commonly known as chili pepper, is used as an important spice globally and as a crude drug in many traditional medicine systems. The fruits of C. annuum have been used as a tonic, antiseptic, and stimulating agent, to treat dyspepsia, appetites, and flatulence, and to improve digestion and circulation. The article aims to critically review the phytochemical and pharmacological properties of C. annuum and its major compounds. Capsaicin, dihydrocapsaicin, and some carotenoids are reported as the major active compounds with several pharmacological potentials especially as anticancer and cardioprotectant. The anticancer effect of capsaicinoids is mainly mediated through mechanisms involving the interaction of Ca2+‐dependent activation of the MAPK pathway, suppression of NOX‐dependent reactive oxygen species generation, and p53‐mediated activation of mitochondrial apoptosis in cancer cells. Similarly, the cardioprotective effects of capsaicinoids are mediated through their interaction with cellular transient receptor potential vanilloid 1 channel, and restoration of calcitonin gene‐related peptide via Ca2+‐dependent release of neuropeptides and suppression of bradykinin. In conclusion, this comprehensive review presents detailed information about the traditional uses, phytochemistry, and pharmacology of major bioactive principles of C. annuum with special emphasis on anticancer, cardioprotective effects, and plausible toxic adversities along with food safety.