Oxidation of food-derived phospholipids (PLs) can influence nutrient digestion and induce oxidative stress in gastrointestinal epithelium. In this study, hen egg yolk PL fraction was used to evaluate the effect of lipoxygenase (LOX)-induced PL oxidation on the rate of PL hydrolysis catalyzed by pancreatic phospholipase A2 (PLA2) in the presence of bile salts (BSs). Then, PL/BS solutions containing native or oxidized PLs were used in in vitro intestinal digestion to assess the effect of PL oxidation and hydrolysis on the toxicity towards HT29 cell line. Based on the obtained results, we suggest that hexanal and (E)-2-nonenal, formed by the decomposition of PL hydroperoxides, inhibited PLA2 activity. The cell exposure to simulated intestinal fluid (SIF) containing BSs decreased HT29 cell viability and significantly damaged cellular DNA. However, the genotoxic effect was reversed in the presence of all tested PL samples, while the protective effect against the BS-induced cytotoxicity was observed for native non-hydrolyzed PLs, but was not clearly visible for other samples. This can result from an overlap of other toxic effects such as lipotoxicity or disturbance of cellular redox homeostasis. Taking into account the data obtained, it was proposed that the PLA2 activity decline in the presence of PL oxidation products may be a kind of protective mechanism against rapid release of oxidized FAs characterized by high cytotoxic effect towards intestinal epithelium cells.