In continuation of our search for new bioactive secondary metabolites from Bacillus cereus associated with entomopathogenic nematode (EPN), three cyclic dipeptides (CDPs), cyclo(L-Leu-D-Arg) (1), cyclo(2-hydroxy-Pro-L-Leu) (2), and cyclo(L-Val-L-Pro) (3) were purified from the ethyl acetate extract of B. cereus. The chemical structure of the compounds was identified by 1D, 2D NMR and HR-ESI-MS. Cyclo(L-Leu-D-Arg) recorded best antifungal activity and the highest activity was recorded against Cryptococcus neoformans (1 μg/mL), which is better than the standard antifungal agent amphotericin B. MTT (3-(4,5-dimethylthiazol-2-yl)-2,5-diphenyltetrazolium bromide) assay was used for finding cell proliferation inhibition and cyclo(L-Leu-D-Arg) recorded significant activity against breast cancer cell line (MDAM-B231) (IC50 value: 25 μM) and the three cyclic dipeptides recorded no toxicity against normal human cell (fore skin (FS) normal fibroblast) up to 50 μM except cyclo(L-Val-L-Pro). Cyclo(L-Leu-D-Arg) induced significant morphological changes and DNA fragmentation associated with apoptosis in MDAM-B231 cells by acridine orange/ethidium bromide staining and flow cytometry analysis. Out of three cyclic dipeptides tested only cyclo(2-hydroxy-Pro-L-Leu) recorded significant antioxidant activity. The hydroxyl radical scavenging activity of cyclo(2-hydroxy-Pro-L-Leu) is greater than BHA, the standard antioxidant agent. Cyclo(L-Leu-D-Arg) was isolated for the first time from a natural source with a d-arginine residue. To the best of our knowledge, this is the first time that the bioactivity of the isolated cyclic dipeptides is reported against medically important fungi and cancer cells. This study is a significant contribution to the knowledge of cyclo(L-Leu-D-Arg) from B. cereus as potential sources of new drugs in the pharmacological industry, especially as potent antifungal and anticancer agent.