In a random screening of antimicrobial activity of tree leaves, Loxostylis alata (Spreng.) f. ex Reichb had shown activity against the pathogenic fungi; Cryptococcus neoformans. This stimulated further interest to investigate its antimicrobial activity. Extracts and compounds isolated from leaves of Loxostylis alata by bioassay-guided fractionation were evaluated for their in vitro antimicrobial, anti-inflammatory (Cyclooxygenase-1 and-2) activities and for their potential toxic effects using 3-(4,5-dimethylthiazolyl-2)-2,5-diphenyltetrazolium bromide (MTT) and Salmonella typhimurium tester strains TA98 and TA100. Antimicrobial activity was evaluated using a serial dilution microplate assay. The bacterial strains used were Staphylococcus aureus (ATCC29213), Enterococcus faecalis (ATCC 29212), Pseudomonas aeruginosa (ATCC 27853) and Escherichia coli (ATCC 25922). While the fungal strains used were isolates of Cryptococcus neoformans, Sporothrix schenckii, Aspergillus fumigatus, Microsporum canis and Candida albicans. A bioassay guided fractionation of the crude extract yielded two antimicrobial compounds namely, Lupeol 1 and β-sitosterol 2. In addition β-sitosterol exhibited selective inhibition of COX-1 (IC 50 = 55.3 ± 2) None of the compounds isolated were toxic in the Salmonella typhimurium/microsome assay and MTT cytotoxicity test. The isolation of these two compounds is reported for the first time from Loxostylis alata.