A chitosan-silver nanocomposite (CAgNC) was synthesized in a green manner using low molecular weight chitosan (LMW-chitosan) and silver nitrate without applying external chemical reducing agents. The newly synthesized CAgNC was characterized by UV-visible spectroscopy, Fourier transform infrared spectroscopy (FT-IR), X-ray diffraction (XRD), field emission electron microscopy (FE-SEM and FE-TEM), inductively coupled plasma-atomic emission spectroscopy (ICP-AES), particle size and zeta potential analysis. The average sizes of LMW-chitosan and CAgNC were 1776 ± 23 nm and 240.1 ± 23.6 nm, respectively. The zeta potential of CAgNC was observed as +41.1 mV. The AgNPs that are deposited on the chitosan matrix had average size ranges between 5 and 50 nm. The Ag content of the CAgNC was determined as 0.696 ± 0.054% (w/w). The minimum inhibitory concentration (MIC) values of LMW-chitosan and CAgNC against Candida albicans were determined as 100 and 50 μg mL⁻¹, whereas the minimum fungicidal concentration (MFC) values were recorded as 400 and 150 μg mL⁻¹, respectively. Propidium iodide (PI) uptake results suggested that CAgNC affected the permeability of the cell membrane of C. albicans. Moreover, CAgNC induced the level of reactive oxygen species (ROS) at a higher level when compared to the LMW-chitosan, in a concentration-dependent manner. This report illustrates the eco-friendly approach for the reduction of silver ions using LMW-chitosan as a reducing agent to make a biologically active composite (CAgNC) and as a potential antifungal agent against C. albicans.