Tetraselmis chuii, belonging to the class Prasinophyceae, are non-toxic microalgae with a fast growth rate and high nutritional value. Currently, the simulated gastrointestinal digestibility of T. chuii and the antioxidant activities of the peptides formed during digestion are unreported. In this study, we aimed to evaluate the antioxidant activity of T. chuii during simulated gastrointestinal digestion using INFOGEST 2.0 method. We also investigated the antioxidant bioactive peptides. In vitro digestion of T. chuii involved treatment with α-amylase, pepsin, and pancreatin during the oral, gastric, and intestinal phases, respectively. Sodium dodecyl sulfate-polyacrylamide gel electrophoresis and degree of hydrolysis showed that the proteins of T. chuii were hydrolyzed into small peptides by digestive enzymes. The antioxidant activity of T. chuii increased during digestion, and the intestinal digesta had significantly higher values of 2.2-Diphenyl-1-picrylhydrazyl (DPPH) (increased 2.96-fold and 1.99-fold compared to the oral and gastric digesta, respectively), 2,2′-Azino-bis (3-ethylbenzothiazoline-6-sulfonic acid) (ABTS) (increased 7.21-fold and 3.38-fold, respectively), ferric reducing antioxidant power (FRAP) (increased to 1.73-fold and 2.17-fold, respectively), and total polyphenol content (TPC) (increased to 4.61-fold and 3.26-fold, respectively). Intestinal digesta were fractionated into <5 kDa (F1), 5–10 (F2), 10–30 (F3), and >30 kDa (F4) fractions by ultrafiltration and evaluated for antioxidant activity. In the fractions, F2 indicated significantly higher antioxidant activity in the DPPH (1.24 ± 0.05 mg trolox equivalent (TE)/g sample) and FRAP (3.66 ± 0.12 mg TE/g sample) assays, while F1 did in the ABTS (47.85 ± 2.54 mg TE/g sample) and TPC (9.85 ± 0.23 mg gallic acid equivalent/g sample) assays. These results suggest that T. chuii and its digestive enzyme products can be successfully used in functional foods as potential antioxidant agents.