This study is aimed to determine the distribution, diversity and bioprospecting aspects of marine pigmented bacteria (MPB) isolated from pristine Andaman Islands, India. A total of 180 samples including seawater, sediment, marine plants, invertebrates, and vertebrates were collected and investigated for isolating pigmented bacteria. Results revealed that sediment, invertebrates, and seawater samples were colonized with a greater number of pigmented bacteria pertains to 27.9 × 103 CFU/mL, 24.1 × 103 CFU/mL and 6.7 × 103 CFU/mL respectively. Orange (21.6 × 103 CFU/mL) and red (8.0 × 103 CFU/mL) MPB were predominant than other pigmented bacteria. Fourteen potential MPB were selected based on their intense pigmentation and tested for bioactive nature and food colorant applications. Out of 14, two red pigmented strains BSE6.1 & S2.1 displayed potential multifaceted applications, such as antibacterial, antioxidant, food colorant, and staining properties. Brown pigmented strains CO8 and yellow pigmented strain SQ2.3 have displayed staining properties. Chemical characterization of red pigment using TLC, HP-LC, GC-MS, FT-IR and 1H-NMR analysis revealed prodigiosin as a main chemical constituent. Pure form of prodigiosin compound fractions obtained from both the strains displayed effective antibacterial activity against different human pathogens. MIC and MBC assays revealed that S2.1 requires 300 µg and 150 µg, respectively, and BSE6.1 require 400 µg concentrations of pigment compound for complete inhibition of S. aureus subsp. aureus. On the basis of 16S rRNA sequence analysis, strains S2.1 and BSE6.1 were identified as Zooshikella sp. and Streptomyces sp. and assigned under the GenBank accession numbers: MK680108 and MK951781 respectively.