This study highlights the optimization of extracellular biosynthesis and antimicrobial efficiency of silver nanoparticles (AgNPs) using the crude metabolite of Escherichia coli D8 (MF06257) strain. The bacterial strain had been isolated from a sewage water stream located in Damietta City, Egypt. The optimum conditions for AgNPs production were at temperature 35°C, pH 7 and 1.5mM silver nitrate. The AgNPs biosynthesis was detected in culture filtrate within 1-2 minutes at room temperature (25±2°C) and sunlight. The characterization of AgNPs was studied by UV-Vis spectroscopy (maximum absorbance at 429 nm), X-ray diffraction (XRD) pattern (crystal planes were 110, 111, 200, 211, 220, and 311), transmission electron microscopy (TEM) (AgNPs were spherical in shape ranging from 6 to 17 nm), Fourier transform-infrared (FTIR) spectroscopy (the bands of symmetric and asymmetric amines were assigned at 3421.1 and 2962.13 cm-1, the stretching vibration band of aromatic and aliphatic (C-N) exist at 1392.35 and 1122.37 cm-1 bands), Zeta potential analyser (AgNPs had a negative charge value; -33.6 mV) and size distribution by volume (the presence of capping agent enveloping the AgNPs with a mean size of 136.0-294.3 nm). Nitrate reductase (NR) was assayed as an important partner in the optimized production (the rate of NR reached to 2.18 U/ml). The study demonstrated that AgNPs are potent inhibitors of Staphylococcus aureus, E. coli, Pseudomonas aeruginosa, Alternaria alternata, Fusarium oxysporum and Aspergillus flavus. The antimicrobial activity of AgNPs was studied by TEM. TEM micrographs showed an inhibition of S. aureus cell multiplication. In case of F. oxysporum, a reduction in the size of treated cells, formation of a mucilage matrix connecting the hyphal cells together, the appearance of a big vacuole, lipid droplets an a severe leakage of cytoplasmic contents were detected. AgNPs exhibited MIC values of 6.25μg/ml and 50 μg/ml against S. aureus and Candida albicans, respectively. In addition, AgNPs showed synergy effects by their combination with fluconazole that increased fold areas especially against A. niger, A. flavus and F. oxysporum.