A total of five compounds namely, 2-methylanthracene-9, 10-dione (1), 1-hydroxy-6-methylanthracene-9,10-dione (2), $eta$-sitosterol (3), stigmasterol (4) and sitosterone (5) were isolated from the stem extracts of Polygonum lanatum for the first time. The structures of the isolated compounds (1-5) were established by extensive spectroscopic studies, including 2D NMR such as $^{1}H-^{1}H$ COSY, HSQC and HMBC studies. The crude extracts and purified compound (1) were screened for antimicrobial activity against a wide range of Gram-positive and Gram-negative bacteria and fungi by the disc diffusion method. The n-hexane and dichloromethane soluble partitionates of the methanolic extract revealed mild to moderate inhibition of growth of the test organisms. The cytotoxic potential of the extractives and compound 1 was also determined by using brine shrimp lethality bioassay, where the extractives demonstrated significant cytotoxic activities.