In this study, essential oil of the aerial part of Pluchea ovalis (POEO) was isolated and employed for the synthesis of AgNPs (POEO-AgNPs). Then, larvicidal activities of POEO and PEO-AgNPs were evaluated against the larvae of fall armyworm (FAW), Spodoptera frugiderda (J. E. Smith); (Lepidoptera: Noctuidae). The potential medicinal values of P. ovalis and the lack of scientific reports on the applications of essential oils and nanoparticles of the plant species from the ecology of Ethiopia motivated the authors to carry out this research activity. The hydrodistillation technique was used for the isolation of POEO. Characterization of samples was done using gas chromatography/mass spectrometry (GC/MS), ultraviolet–visible spectroscopy (UV–Vis), scanning electron microscope-energy dispersive X-ray spectroscopy (SEM-EDX), Fourier transform infrared spectroscopy (FTIR), X-ray diffraction (XRD), and zeta nanoanalyzer instruments. GC/MS analysis showed that sesquiterpenes (91.27%) are the dominant chemical constituents of POEO. The characteristic UV–Vis spectra absorption of POEO-AgNPs is observed at 428 nm. SEM imaging reveals that POEO-AgNPs have a dominantly spherical shape. A strong peak of EDX at 3.0 keV shows the existence of Ag element in POEO-AgNPs. XRD analysis determines the diffraction peaks of POEO-AgNPs at 2θ of 38.2°, 44.1°, 64.6°, and 77.8° which are indexed to (111), (200), (220), and (311), respectively. The average particle size and surface potential of POEO-AgNPs are 132 nm and −64.7 mV, respectively. POEO-AgNPs were stored at room temperature and 4 °C and showed good stability for about 6 months without aggregation or dissolution. The larvicidal activity was tested at 500, 250, and 125 µg/mL of POEO solution and 100% (full strength = 0.083 g/mL), 50%, and 25% POEO-AgNPs solution against 2nd instar larvae of S. frugiderda for 3 consecutive days. LC50 and LC90 are determined as 154.88 and 11,749.00 µg/mL for POEO and 69.18 and 1318.26% for POEO-AgNPs solutions, respectively. This finding will benefit the applications of POEO and POEO-AgNPs for a sustainable eco-friendly crop pest management method.