Chitosan (CS), a seaweed polysaccharide is a natural macromolecule which is widely being used in medical applications because of its distinctive antimicrobial and anticancer properties. Silver, a noble metal, is also receiving wide attention for its potential usage in antimicrobial and anticancer therapeutics. In this study, an effective way of reduction of silver using chitosan at varying reaction temperatures and an optimised concentration of silver were performed. The optical, structural, spectral, morphological and elemental studies of the biosynthesized chitosan-silver (CS-Ag) nanocomposites were characterized by several techniques. The synthesized CS-Ag nanocomposites exhibit particle size around 20nm and were further exploited for potent biological applications in nanomedicine due to their nanometric sizes and biocompatibility of chitosan. The antimicrobial activity of the biosynthesized CS-Ag nanocomposites exhibits zone of inhibition ranged between 09.666±0.577 and 19.000±1.000 (mm). The minimum inhibitory concentration (MIC) and minimum bactericidal concentration (MBC) were from 8 to 128μgmL−1 and 16 to 256μgmL−1 respectively, with the highest antimicrobial activity shown against Gram-negative Salmonella sp. The synergistic effect of chitosan and silver as a composite in nanometric size revealed significant IC50 value of 29.35μgmL−1 and a maximum of 95.56% inhibition at 100μgmL−1 against A549 lung cancer cell line, resulting in potent anticancer effect.