The essential oil of Achillea setacea was isolated by hydrodistillation and characterized by GC-MS. The antioxidant and antimicrobial activity of Achillea setacea essential oil was evaluated, as well as its biocompatibility (LDH and MTT methods). DPPH, FRAP, and CUPRAC methods were applied for antioxidant activity evaluation, while qualitative and quantitative assays (inhibition zone diameter, minimum inhibitory concentration, and minimum fungicidal concentration), NO release (by nitrite concentration determination), and microbial adhesion capacity to the inert substrate (the biofilm microtiter method) were used to investigate the antimicrobial potential. A total of 52 compounds were identified by GC-MS in A. setacea essential oil, representing 97.43% of the total area. The major constituents were borneol (32.97%), 1,8-cineole (14.94%), camphor (10.13%), artemisia ketone (4.70%), α-terpineol (3.23%), and γ-eudesmol (3.23%). With MICs ranging from 0.78 to 30 μg/mL, the A. setacea essential oil proved to inhibit the microbial adhesion and induce the NO release. To the best of our knowledge, the present study reports for the first time the antimicrobial activity of A. setacea EO against clinically and biotechnologically important microbial strains, such as Shigella flexneri, Listeria ivanovii, L. innocua, Saccharomyces cerevisiae, Candida glabrata, Aspergillus niger, Rhizopus nigricans, Cladosporium cladosporioides, and Alternaria alternata, demonstrating its antimicrobial applications beyond the clinical field.