Improvement of the medical textile industry has received more attention recently, especially with widespread of microbial and viral infections. Medical textiles with new properties, such as bacterial pathogens self-cleaning, have been explored with nanotechnology. In this study, an endophytic actinomycetes strain of Streptomyces laurentii R-1 was isolated from the roots of the medicinal plant Achillea fragrantissima. This is used as a catalyst for the mediated biosynthesis of silver nanoparticles (Ag-NPs) for applications in the textile industry. The biosynthesized Ag-NPs were characterized using UV-vis spectroscopy, Fourier transform infrared (FT-IR), transmission electron microscopy (TEM), and X-ray Diffraction (XRD), which confirmed the successful formation of crystalline, spherical metal nanoparticles. The biosynthesized Ag-NPs exhibited broad-spectrum antibacterial activity. Our data elucidated that the biosynthesized Ag-NPs had a highly cytotoxic effect against the cancerous caco-2 cell line. The selected safe dose of Ag-NPs for loading on cotton fabrics was 100 ppm, regarding their antibacterial activity and safe cytotoxic efficacy. Interestingly, scanning electron microscope connected with energy dispersive X-ray spectroscopy (SEM-EDX) of loaded cotton fabrics demonstrated the smooth distribution of Ag-NPs on treated fabrics. The obtained results highlighted the broad-spectrum activity of nano-finished fabrics against pathogenic bacteria, even after 5 and 10 washing cycles. This study contributes a suitable guide for the performance of green synthesized NPs for utilization in different biotechnological sectors.