The production of nanoparticles for biomedical applications (namely with antimicrobial and anticancer properties) has been significantly hampered using traditional physicochemical approaches, which often produce nanostructures with poor biocompatibility properties requiring post-synthesis functionalization to implement features that such biomedical applications require. As an alternative, green nanotechnology and the synthesis of environmentally friendly nanomaterials have been gaining attention over the last few decades, using living organisms or biomolecules derived from them, as the main raw materials to produce cost-effective, environmentally friendly, and ready-to-be-used nanomaterials. In this article and building upon previous knowledge, we have designed and implemented the synthesis of selenium and tellurium nanoparticles using extracts from fresh jalapeño and habanero peppers. After characterization, in this study, the nanoparticles were tested for both their antimicrobial and anticancer features against isolates of antibiotic-resistant bacterial strains and skin cancer cell lines, respectively. The nanosystems produced nanoparticles via a fast, eco-friendly, and cost-effective method showing different antimicrobial profiles between elements. While selenium nanoparticles lacked an antimicrobial effect at the concentrations tested, those made of tellurium produced a significant antibacterial effect even at the lowest concentration tested. These effects were correlated when the nanoparticles were tested for their cytocompatibility and anticancer properties. While selenium nanoparticles were biocompatible and had a dose-dependent anticancer effect, tellurium-based nanoparticles lacked such biocompatibility while exerting a powerful anti-cancer effect. Further, this study demonstrated a suitable mechanism of action for killing bacteria and cancer cells involving reactive oxygen species (ROS) generation. In summary, this study introduces a new green nanomedicine synthesis approach to create novel selenium and tellurium nanoparticles with attractive properties for numerous biomedical applications.