Capsicum frutescens is a species of the Solanaceae family of the genus Capsicum, which has around 20 species, five of which are regularly cultivated: “Capsicum annuum, Capsicum baccatum, Capsicum chinense, Capsicum frutescens, and Capsicum pubescens.” Since ancient times, C. frutescens has been used to taste and colour food all throughout the world. However, it is also employed for its medical benefits by many civilizations all over the world. This prompted researchers to concentrate on its chemical components, which led to a number of studies. The components isolated from C. frutescens such as capsaicinoids, carotenoids, and saponins authenticated its antibacterial, antidiabetic, anti-fungal, cardiovascular, thrombolytic, anti-cancer, and anti-oxidant activities along with a few more through various studies. This review focuses on all the pharmacological properties of these components highlighting the significance of Capsicum frutescens in herbal medicine.