Medicinal plant-derived carbon dots are eco-friendly and possess therapeutic properties. Among the medicinal plants studied throughout the world, Centella asiatica (L.) Urb. is known for its medicinal values, especially its neuroceutical and cogniceutical properties. This work discusses the green synthesis of carbon dots (CDs) using C. asiatica leaves as the carbon source via fast and cost-effective microwave-assisted method, and its physico-chemical characterization via UV–visible, fluorescence and FTIR spectrometry, XRD, SEM, AFM, TEM, SAED, EDX and zeta potential analyses. The study revealed quasi-spherical CDs having size ~ 3–6 nm, polycrystalline nature, and presence of various functional groups like –COOH, –H, =CH2 and C–O–C with UV absorption peaks at 213 and 322 nm. Interestingly, the C. asiatica-derived CDs exhibited blue fluorescence under UV with maximum emission wavelength of 460 nm when excited at 400 nm. Further, these CDs were evaluated for their biological applications, which uncovered their potential in therapeutics such as antimicrobial properties against both Gram-positive and Gram-negative bacteria at a dose of 10 μg, strong antioxidant activity with IC50 values of 165.28 and 128.48 μg mL−1 in DPPH and H2O2 assays, respectively, and profound anti-inflammatory activity with IC50 value of 106.20 μg mL−1 in protein denaturation assay. The CDs were also assessed for cytotoxicity using whole blood cells and were found to be safe for in vitro administration. Thus, the C. asiatica-derived CDs can be exploited for their potent biomedicinal properties.