Phytophthora capsici is a highly destructive phytopathogenic oomycete with a broad host range and is responsible for tremendous losses. Euphorbia factor L3 (EFL3) is a natural plant-derived compound that has been widely studied in medicine and cosmetic applications. In this study, the sensitivity of 105 P. capsici isolates to EFL3 was determined, and the biological activity and physiological effects of EFL3 against P. capsici were investigated. The median effective concentration (EC50) values for EFL3 inhibition mycelial growth and spore germination ranged from 0.66 to 8.94 μg/mL (mean, 2.96 ± 0.91 μg/mL) and 1.63 to 13.16 μg/mL (mean, 5.30 ± 1.64 μg/mL), respectively. EFL3 treatment resulted in cell wall and cell membrane damage of P. capsici, which was revealed by morphological and ultrastructural observations, propidium iodide (PI) and calcofluor white (CFW) staining, and measurements of relative conductivity as well as malondialdehyde (MDA) and glycerol contents. In addition, the contents of phospholipid and cellulose, which are the major components of cell membrane and cell wall, were significantly reduced following EFL3 treatment. Furthermore, EFL3 provided protective as well as curative efficacies against P. capsici on detached tomato leaves and pepper seedlings in vivo. These data show that EFL3 exhibits strong inhibitory activity against P. capsici, thereby suggesting that it could be an effective alternative for controlling P. capsici-induced diseases.