Biogenic synthesis using medicinal plants has less harmful effects as compared to chemically synthesized nanoparticles. Here, for the first time, we successfully demonstrated the eco-friendly synthesis of zinc oxide nanoparticles (ZnO NPs) using an aqueous extract of L. The phyto-mediated ZnO NPs were characterized using UV-visible spectroscopy, XRD (X-ray diffraction), FT-IR (Fourier transform infrared spectroscopy), SEM (scanning electron microscopy) and TEM (transmission electron microscopy). They were also evaluated for anti-diabetic activity, biocompatibility with RBCs and bactericidal biological applications. The UV spectrum showed a strong surface plasmon peak for ZnO NPs at 360 nm. The optical band gap was observed to be 2.93 eV using UV spectroscopy data. The crystalline nature and the crystal size (48 nm) of the prepared ZnO NPs were confirmed by XRD. FT-IR analysis confirmed the formation of functional bio-molecules linked with ZnO NPs. SEM and TEM images revealed irregular and spherical morphology. The ZnO NPs demonstrated moderate enzyme inhibition (30.8%) at a concentration of 200 mg ml. No potential damage was caused by ZnO NPs to red blood cells, if used in low doses. aqueous extract has the potency to combat drug-resistant bacteria but comparatively, ZnO NPs synthesized from the same plant were found to be more effective against resistant pathogenic strains. It is concluded from the above study that phyto-fabricated ZnO NPs have strong potential as theranostic agents and can be adopted in drug delivery systems.