This study developed a chitosan-based edible coating enriched with liquid smoke derived from the pyrolysis of oil palm empty fruit bunches (OPEFB) and neem (Azadirachta indica) leaf extract as a sustainable alternative to synthetic packaging. The coating was prepared using liquid smoke (1–3% v/v), gelatin (1% w/w), chitosan (1% w/w), and neem extract (2%). Liquid smoke was obtained through OPEFB pyrolysis at 300–380 °C. The coatings were characterized using Fourier Transform Infrared Spectroscopy (FTIR) and X-Ray Fluorescence (XRF), and evaluated for total flavonoid content, Minimum Inhibitory Concentration (MIC), Minimum Bactericidal Concentration (MBC), and antimicrobial activity against Gram-positive and Gram-negative bacteria using the Kirby-Bauer disk diffusion method. FTIR spectra confirmed the presence of hydroxyl, amine, and phenolic groups responsible for structural stability and antimicrobial functionality, while mineral components such as P₂O₅, MgO, and CaO enhanced the film matrix. The formulation containing 1% liquid smoke derived at 340°C showed the highest flavonoid content and strongest antimicrobial effect against Escherichia coli, Salmonella Typhimurium, Staphylococcus aureus, and Bacillus subtilis. Inhibition zones were classified as strong against E. coli (14.87–17.57 mm) and S. Typhimurium (11.77–12.09 mm), and moderate against S. aureus (7.25–8.44 mm) and B. subtilis (9.79–10.39 mm). These results indicate that antimicrobial activity was influenced not only by flavonoid concentration but also by synergistic effects of other bioactive compounds. The developed coating shows potential as a natural food preservative while supporting circular economy practices through agricultural waste utilization.