The current study focused on novel approaches for plasma-activated water treated sweet orange peel waste through the use of various food-grade debittering agents (salt, alkali, and solvent). Among the different methods investigated, solvent treatment with acetone at a ratio of 1:10 (sample: solvent, DSL2) achieved a greater reduction in bitterness causing compounds naringin from 0.59 to 0.41 mg/g and limonin 1.30 to 1.17 mg/g. Moreover, the hurdle impact of both and debittering treatment was effective in reducing the total terpenoid content from 290.89 mg LE/100 g to 230 mg LE/100 g and anti-nutrients, tannin (289.20 mg/100 g to 109.63 mg/100 g), phytic acid (52.22 mg/100 g to 22.55 mg/100 g). The saponin was not found in the treated samples. Solvent treatment decreased total phenols from 163.46 ± 2.54 to 115.81 ± 5.02 mg GAE/100 g and total flavonoids from 662.23 ± 4.53 to 548.48 ± 2.98 mg QE/100 g. Similarly, FRAP (Ferric reducing antioxidant power) decreased from 58.87 ± 1.57 to 38.08 ± 1.96 μg AAE/g and DPPH (2, 2-Diphenyl-1-picrylhydrazyl) (%) from 151.06 ± 3.07 to 123.81 ± 2.46. Optimization of all treatment conditions was accomplished using a full factorial design. Treatment at a ratio of 1:10 (sample: salt, DS2) was determined to be the most optimized condition, taking into account all parameters (total phenols, total flavonoids, total terpenoid content, naringin, limonin, hesperidin, antinutrients and antioxidant activities) including sensory evaluation. Debittered sweet orange peel powder obtained through this process demonstrated higher acceptability for functional and novel food product development.