The present study reports the synthesis of gold nanoparticles (AuNPs) using ‘sea grapes’ (Macroalgae) of Caulerpa racemosa extract in a simple, fast and environmentally friendly biogenic method. The formation of spherical, stable, polycrystalline nanoparticles with an average size of 18–45 nm was demonstrated by UV–vis spectroscopy, SEM, high-resolution transmission electron microscopy and X-ray diffraction measurements. Furthermore, FTIR analysis confirmed the presence of phytochemical constituents in the form of functional groups involved in AuNPs synthesis. Antimicrobial activities confirmed that Gram-negative bacteria, here represented by Escherichia coli, were found to be more sensitive to synthesized AuNPs than Gram-positive bacteria, represented by Staphylococcus aureus. The synthesized nanoparticles also showed cytotoxicity against human lung cancer cells (H460) with an IC50 value of 25 μg/mL. Furthermore, our findings show that AuNPs derived from C. racemosa extract are able to induce apoptosis activation via extrinsic and intrinsic pathways and mitochondrial pathways. These findings lay the groundwork for future research against emerging multi-drug resistant bacterial pathogens, as well as lung cancer treatment.