Thymus albicans is an endemic species of the Iberian Peninsula with a vulnerable conservation status. In an attempt to contribute to the valorization of this species, the present study brings new insights on the antifungal and anti-inflammatory mechanism of action of T. albicans essential oil. The antifungal activity of the oil and its major compounds was assessed for the first time against standard and clinically isolated strains of yeasts and filamentous fungi. The effect on the two major virulence factors of Candida albicans (germ tube formation and biofilm disruption) was considered in more detail. At 0.08 μL/mL, the oil inhibited C. albicans germ tube formation by more than 40% and decreased biofilm biomass at MIC values, thus pointing out its antivirulent potential. The anti-inflammatory activity of the essential oil was investigated on LPS-stimulated mouse macrophages (RAW 264.7) by evaluating the levels of several pro-inflammatory mediators, namely nitric oxide (NO), inducible nitric oxide synthase (iNOS) and cyclooxygenase-2 (COX-2). T. albicans oil reduced the production of nitrites, a NO derived sub-product, at non-cytotoxic concentrations of 0.32 and 0.64 μL/mL, by 27 and 41%, respectively. In addition, the iNOS protein levels of essential oil pre-treated cells were reduced by 14%. Overall, the high essential oil yield of T. albicans as well as its bioactive effects at concentrations without cytotoxicity, encourage further studies on the potential pharmacological applications of this species. Furthermore, these results raise awareness for the need to preserve endangered species that may hold relevant medicinal value.