Plant growth regulators can affect the primary and secondary metabolites of various plant species. However, the effect of paclobutrazol (PBZ) on the composition of lavender oil, especially related to the terpenoid pathway, is still unclear in literatures. In this study, the effect of PBZ as a foliar spray (0.200, 400 and 600 ppm) on the vegetative growth, phytochemical content, and both antioxidant and antimicrobial properties of lavender oil were investigated. The results indicated that all examined PBZ treatments led to a significant (p ≤ 0.05) decrease in growth parameters compared to the untreated plants. Meanwhile, the yield of essential oil was significantly decreased by the treatment of PBZ at 200 ppm compared to the control. In contrast, applied-PBZ significantly enhanced the chlorophyll content and displayed a marked change in the composition of the essential oil. This change included an obvious and significant increase in 3-carene, eucalyptol, γ–terpinene, α-pinocarvone, caryophyllene, β-vetivenene, β-santalol, ledol, geranyl isovalerate, farnesol, caryophyllene oxide, and phytol percentage. Generally, the highest significant values were achieved by the treatment of 400 ppm compared to the other treatments. Furthermore, this treatment showed the highest free radical scavenging activity against DPPH (1,1-diphenyl-2-picrylhydrazyl) by 13% over the control. Additionally, to determine the antimicrobial activities of the extracted oil, each treatment was examined against two strains of Gram positive bacteria (S. aureus and B. cereus), two strains of Gram negative bacteria (S. enteritidis and E. coli), and two fungal species (C. albicans and A. niger) represent the yeast modal and filamentous fungus, respectively. The findings demonstrated that all examined species were more sensitive to the oil that was extracted from lavender plants, treated with 400 ppm PBZ, compared to the other concentrations.