Citrus peels are generally discarded as waste, although they are rich sources of health-promoting compounds. This study investigated the properties of citrus peels for development as a potential functional tea ingredient. Three citrus peel powders (DCPPs, Cheonhyehyang, Hallabong, and orange) which were dried by air- and freeze-drying, were used to prepare machine-drip tea. Then, total polyphenol compounds (TPCs), flavonoids, and the DPPH radical scavenging activity of DCPPs and teas were evaluated. Freeze-dried DCPPs had relatively higher TPC s (16.47–21.11 mg GAE/g) and DPPH radical scavenging activity (3.25–16.43 mg GAE/g) than air-dried DCPPs; TPCs (14.06–19.12 mg GAE/g) and DPPH radical scavenging activity (1.80–3.22 mg GAE/g). In contrast, air-dried DCPPs were more effective in machine-drip teas, showing a higher range of TPCs (50.64–85.12 mg GAE/100 mL) and DPPH radical scavenging activity (1.05–3.86 mg GAE/100 mL) than freeze-dried DCPPs; TPCs (40.44–46.69 mg GAE/100 mL) and DPPH radical scavenging activity (0.56–1.08 mg GAE/100 mL). Among citrus varieties, Cheonhyehyang had the highest TPCs and DPPH radical scavenging activity in both DCPP and tea. Four flavonoids (Hesperidin, Naringin, Nobiletin, and Tangeretin) mainly existed in citrus peels. The amount of hesperidin was highest; therefore, Hallabong and orange exhibited higher total flavonoid contents. However, freeze-dried Cheonhyehyang peel and air-dried Cheonhyehyang tea, which showed the highest TPCs and DPPH radical scavenging activity, had higher nobiletin and tangeretin. This implies that nobiletin and tangeretin strongly influenced the antioxidant activity of citrus peels with TPC. This research provides essential information for the tea industry looking for functional ingredients. In addition, it helps to reduce by-products by using citrus peel powders.