Polyethylene (PE) is one of the most common materials used for medical implants. However, it usually possesses low biocompatibility and insufficient antibacterial properties. In the work described here, plasma immersion ion implantation (PIII) is employed to implant silver into PE to enhance both its antibacterial properties and its biocompatibility. Our results show that Ag PIII can give rise to excellent antibacterial properties and induces the formation of functional groups such as C-O and C=C. These C-O and C=C groups on the modified surface can trigger the growth of the human fetal osteoblastic cell line (hFOB). Furthermore, combining N(2) and Ag PIII prolongs the antibacterial effects, but nitrogen-containing functional groups such as C-N and C=N created by N(2) co-PIII negatively impact proliferation of hFOB on the surface. According to our experimental investigation on cell proliferation, functional groups such as C-N and C=N created by nitrogen PIII are disadvantageous to cell growth whereas the C-O and C=C groups benefit cell growth. Both the antibacterial activity and biocompatibility of PE can be enhanced by means of the proper plasma surface treatment.