Myrcianthes discolor, an aromatic native tree from southern Ecuador, was collected to determine the chemical composition and the biological activity of its essential oil (EO). The EO was obtained by steam-distillation and analyzed by gas chromatography coupled to a mass and a FID detector (GC-MS and GC-FID) and a non-polar DB5-MS column. Enantioselective GC-MS analysis was performed in a chiral capillary column. The antimicrobial, antioxidant, and anticholinesterase potency of the EO was carried out by the broth microdilution method, radical scavenging assays using 2,2′-azino-bis-3-ethylbenzthiazoline-6-sulphonic acid (ABTS) and 1,1-diphenyl-2-picrylhydrazyl (DPPH) radical, and by measuring the inhibition of the acetylcholinesterase (AChE) enzyme. A total of 58 chemical compounds were identified, corresponding to 94.80% of the EO composition. Sesquiterpenes hydrocarbons represented more than 75% of the composition. The main compounds detected were E-caryophyllene with 29.40 ± 0.21%, bicyclogermacrene with 7.45 ± 0.16%, β-elemene with 6.93 ± 0.499%, α-cubebene with 6.06 ± 0.053%, α-humulene with 3.96 ± 0.023%, and δ-cadinene with 3.02 ± 0.002%. The enantiomeric analysis revealed the occurrence of two pairs of pure enantiomers, (−)-β-pinene and (−)-α-phellandrene. The EO exerted a strong inhibitory effect against AChE with an IC50 value of 6.68 ± 1.07 µg/mL and a moderate antiradical effect with a SC50 value of 144.93 ± 0.17 µg/mL for the ABTS radical and a weak or null effect for DPPH (3599.6 ± 0.32 µg/mL). In addition, a strong antibacterial effect against Enterococcus faecium was observed with a MIC of 62.5 μg/mL and Enterococcus faecalis with a MIC of 125 μg/mL. To the best of our knowledge, this is the first report of the chemical composition and biological profile of the EO of M. discolor, and its strong inhibitory effect over AChE and against two Gram-positive pathogenic bacteria, which encourage us to propose further studies to validate its pharmacological potential.