Timor Island is located in a geologically complex region strongly affected by the collision of the Australian margin with the Banda volcanic arc. In Oecusse, an enclave of East Timor in the western part of Timor, crop out several lithological units of the Banda Terrane that are associated with the obduction of oceanic crust and upper mantle on the Australian continental crust. This study reports the geochemistry of stream sediments from the coastal region of the Oecusse enclave, where the Banda Terrane is best represented, employing statistical analyses to discern the sources of metal(oid)s and assessing ecological and health risks. Arsenic, Cr, and Ni are the elements with higher potential ecological risk factors. The potential ecological risk index (PERI), which combines single indexes of ecological risk factors for multiple elements, is very high in a stream sourced by the Lolotoi-Mutis Complex. Significant risks for human health were found for As (sourced by the Lolotoi-Multis Metamorphic Complex and basalts of the Barique Formation), Mn (sourced by the Maubisse and Barique formations), and V (sourced by the Manamas Formation). The highest values of hazard index (HI), however, were determined with Cr, in particular for children (HI higher than 10 in 12 sediments sourced by ultramafic units and their covering sedimentary units). This investigation shows that high geogenic concentrations of several elements, particularly those derived from the oceanic crust and the upper mantle, raise significant cancer and non-carcinogenic risks.