Macroalgae Ulva lactuca, has been employed as a natural source for the production of extracts with potent bioactivity. The biochemical characterization showed that the macroalgae biomass contains a remarkable amount of the polysaccharide Ulvan (49.9 wt%) which is a valuable chemical compound well known for its benefits in human health. Four nontoxic solvents, water, ethyl acetate, ethanol, and an ethanol/water mixture (70:30 v/v) were examined for their recovery efficiency of total carotenoid and phenolic contents. Experimental results showed that the aqueous mixture of ethanol was the most efficient solvent in the recovery of bioactive compounds with extraction yield of 10–15% dw. The effect of extraction parameters, namely time, temperature, and the ratio of biomass to solvent, on the carotenoid and phenolic compounds’ content, antioxidant activity, and extraction yield, was investigated, using the ethanol/water mixture as a solvent. The extract obtained under 60 °C, 3 h of extraction time and 1:10 biomass to solvent mass ratio showed the highest antioxidant activity. This extract maintained its antioxidant capacity almost stable for five days of storage under cool and dark conditions. Finally, specific phenolic and carotenoid compounds in the U. lactuca extracts were identified using the High-Performance Liquid Chromatography (HPLC) technique.