One-third of all food produced for human use is discarded as waste, resulting in environmental pollution and impaired food security. Fruit peels have bioactive compounds that may be used as antimicrobials and antioxidants, and the use of fruit peels is considered an alternative way to reduce environmental problems and agro-industrial waste. The aim of this study was to evaluate the phytochemical, mineral, extraction yield, total phenolic, total flavonoids, antioxidant, and antibacterial activity of several peel fruits, including Citrus sinensis (orange) and Punica granatum (pomegranate). The results revealed that pomegranate peel powder contains the highest amounts of ash, fiber, total carbohydrates, Ca, Fe, Mg, and Cu, while orange peel contains the highest amounts of moisture, protein, crude fat, P, and K. Furthermore, the aqueous and methanolic pomegranate peel extracts yielded higher total phenolic and total flavonoids than the orange peel extract. The identification and quantification of polyphenol compounds belonging to different classes, such as tannins, phenolic acids, and flavonoids in pomegranate peel and flavonoid compounds in orange peel were performed using UPLC-MS/MS. In addition, GC−MS analysis of orange peel essential oil discovered that the predominant compound is D-Limonene (95.7%). The aqueous and methanolic extracts of pomegranate peel were proven to be efficient against both gram-positive and gram-negative bacteria linked to human infections. Sponge cake substituting wheat flour with 3% pomegranate peel and 10% orange peel powder had the highest total phenolic, flavonoid compounds, and antioxidant activity as compared to the control cake. Our results concluded that pomegranate and orange peel flour can be used in cake preparation and natural food preservers.