This study mainly investigates the influence of combined parametric conditions employed in submerged waterjet peening for biomedical applications. On measuring the microhardness and roughness on the peened surface, the finding corresponded directly with the strengthening of subsurface layers and different parametric combinations. The optimum parametric combination was determined by TOPSIS, considering microhardness and surface roughness as input. Under optimal parametric combinations, surface morphology and topography analysis, XRD analysis, corrosion behaviour examination, and cell morphology and viability analysis were studied and compared to unpeened surface. From the experimental results, the water bubbles create impulsive pressure that impacts the AZ31B Mg alloy's surface, promoting plastic deformation in the subsurface, enhancing the surface morphological and topographical characteristics, and making the alloy more suitable for bioimplant manufacture. Following that, these samples underwent an electrochemical corrosion study, which indicates the peened region's corrosion rate was reduced considerably compared to the unpeened region. In the course of biocompatibility analysis, the non-toxic nature of the peened region in the MG63 cell line was observed after 24 and 72 h.