The essential oil of tea tree (Melaleuca alternifolia) is widely used in traditional Australian medicine for skin lesions and infected injuries. In the present study, we investigated the chemical composition, cytotoxicity and its biological activities. The composition of the oil was analyzed by GC-MS. β-Terpinene (20.87%), α-pinene (17.60%), p-cymene (11.23%), 3-carene (10.40%), trans-anethole (8.47%) and limonene (4.65%) were the major components in the oil. The results tested by MTT assay indicated that the oil showed no cytotoxic effect, at concentrations up to 5%, for less than 3h. The antiradical capacity was evaluated by measuring the scavenging activity of the essential oil on the 2,20-diphenylpicrylhydrazyl (DPPH) and 2,2'-azino-bis 3-ethyl benzothiazoline-6-sulfonic acid (ABTS) radicals. The oil was able to reduce the both radicals dose-dependently, and the concentration required for 50% reduction (RC50) against ABTS radicals (1.6±0.02%) was slightly lower than DPPH radicals (2.6±0.29%). The direct contact and vapor-phase antibacterial activity of the oil were also evaluated using disc diffusion method against Staphylococcus aureus, Streptococcus mutans, Listeria monocytogenes, Acinetobacter baumannii, Escherichia coli, and Vibrio parahaemolyticus. All the Gram-negative bacterial strains tested showed more sensibility to the oil than the Gram-positive strains when compare to the effect of gentamycin. On the other hand, the vapor phase of the essential oil against S. aureus exhibited strongest inhibitory effect.