Celastrus paniculatus Willd., an important medicinal plant widely used in Ayurveda, is enriched with remarkable nervine, cognition enhancing, and other therapeutic properties. However, the chemical constituents of the essential oil of the plant have not been reported yet. To our knowledge, this is the first report of the essential oil composition of C. paniculatus seeds, analyzed through gas chromatography–mass spectrometry (GC–MS). The oil yield was found to be 0.09% (v/w). A total of 56 constituents were identified, comprising of 99.2% of the total oil. The major component was palmitic acid with maximum composition of 38.61%, followed by phytol (11.72%), erucic acid (6.99%), trans-beta-copaene (4.78%), and linalool (3.97%). Antioxidant and anti-inflammatory activities of the aqueous, methanolic, and chloroform extracts of C. paniculatus seeds were also evaluated using 2,2-diphenyl-1-picrylhydrazyl (DPPH) radical scavenging assay, Trolox equivalent antioxidant capacity (TEAC), Ferric reducing antioxidant power assay (FRAP), and lipoxygenase inhibition assay, respectively. Total phenolic content was also determined in the study. Almost all the assays suggested chloroform extract to have the strongest antioxidant property and the highest phenolic content. However, aqueous extract showed maximum anti-inflammatory activity. The major components identified in the essential oil, being strongly antioxidant in nature, reveal the possible cause of C. paniculatus being highly efficacious in cognition enhancement. The study also suggests that the essential oil from the seeds of the plant could be used as another potential source for new drug development in treating various disorders caused by extreme oxidative stress.