In continuation to our search for novel bioactive compounds from fungi, we profiled bioactive secondary metabolites from an endophytic fungus, Chaetomium arcuatum strain (Semecarpus anacardium fruit, SAF) SAF-2, isolated from the fruit of Semecarpus anacardium. Bioactivity-guided fractionation of the methanolic extract resulted in two compounds which were structurally elucidated as eugenetin and 6-hydroxymethyleugenin based on 1H and 13C NMR, Fourier transform infrared (FT-IR), and mass spectroscopic techniques. The crystal structure of 6-hydroxymethyleugenin was also confirmed by X-ray crystallography. Cytotoxicity results in vitro revealed that 6-hydroxymethyleugenin exhibited promising cytotoxicity against MCF7, MDA-MD-231, A549, and COLO205, while HeLa and K562 did not show any cytotoxicity. Eugenetin showed moderate cytotoxicity against MCF-7, HeLa, MDA-MD-231, and A549, while COLO205 and50K562 did not show any cytotoxicity. The IC (50% inhibitory concentration) 50 values of acetylcholine esterase (AChE) inhibitory activity determined by Ellman assay for eugenetin and 6-hydroxymethyleugenin were 28.40 μM and 9.83 μM, respectively; while galanthamine (standard) exhibited IC value of 2.50 μM. To understand the binding mode predictions of acetylcholinesterase complexed with eugenetin and 6-hydroxymethyleugenin in comparison with galanthamine, in silico studies were carried out. This is a first report on endophytic Chaetomium arcuatum producing bioactive chromanone compounds like eugenetin and 6-hydroxymethyleugenin exhibiting promising acetylcholinesterase inhibitory and anti-cancer activities.