The excessive accumulation of nickel (Ni) poses a significant threat to global agricultural productivity. In recent years, it has become clear that melatonin (ME) may play a significant role in protecting plants against heavy metal toxicity. This current study investigates the influence of exogenous ME on mitigating the adverse effects of Ni toxicity in pepper plants. The present results revealed that Ni toxicity significantly hindered pepper seedling growth, damaged the leaf photosynthetic system, impaired pigment concentration, and increased phenolic content. In contrast, ME supplementation efficiently restored seedling growth, protected the photosynthetic system, and further increased the phenolic concentration in pepper leaves. In addition, Ni toxicity considerably increased malondialdehyde (MDA) and hydrogen peroxide (H2O2) production and increased antioxidant enzymes [SOD (superoxide dismutase), CAT (catalase), POD (peroxidase), GR (glutathione reductase), APX (ascorbate peroxidase), and GST (glutathione S-transferase)] activity in pepper leaves and roots. Conversely, ME inhibited MDA and H2O2 accumulation and further increased the antioxidant enzyme activity in pepper leaves and roots. Furthermore, ME application restricted Ni accumulation from root to shoot. Collectively, the ME has shown the ability to mitigate the adverse effects of Ni toxicity in pepper plants. The findings of this study will contribute to the understanding and mitigation of the adverse impacts of Ni-induced stress on the growth and development of plants.