A feeding trial for 90 days was conducted on Nile tilapia (Oreochromis niloticus) (average weight: 25.50 ± 0.05 g) to evaluate the effect of dietary inclusion of Azadirachta indica seed protein hydrolysate (AIPH). The evaluation included the impact on the growth metrics, economic efficiency, antioxidant potential, hematobiochemical indices, immune response, and histological architectures. A total of 250 fish were randomly distributed in five treatments (n = 50) and received diets included with five levels of AIPH (%): 0 (control diet, AIPH0), 2 (AIPH2), 4 (AIPH4), 6 (AIPH6) or 8 (AIPH8), where AIPH partially replace fish meal by 0, 8.7%, 17.4%, 26.1%, and 34.8%, respectively. After the feeding trial, a pathogenic bacterium (Streptococcus agalactiae, 1.5 × 108 CFU/mL) was intraperitoneally injected into the fish and the survival rate was recorded. The results elucidated that AIPH‐included diets significantly (p < 0.05) enhanced the growth indices (final body weight, total feed intake, total body weight gain, and specific growth rate) and intestinal morphometrics (villous width, length, muscular coat thickness, and goblet cells count) in comparison to the control diet, with the AIPH8 diet recording the highest values. Dietary AIPH inclusion significantly improved (p < 0.05) the economic efficacy indicated by reduced feed cost/kg gain and increased performance index. The fish fed on the AIPH diets had noticeably significantly higher (p < 0.05) protein profile variables (total proteins and globulin) and antioxidant capabilities (superoxide dismutase and total antioxidant capacity) than the AIPH0 group. The dietary inclusion of AIPH significantly (p < 0.05) boosted the haematological parameters (haemoglobin, packed cell volume %, and counts of red blood cells and white blood cells) and immune indices (serum bactericidal activity %, antiprotease activity, and immunoglobulin M level) in a concentration‐dependent manner. The blood glucose and malondialdehyde levels were significantly (p < 0.05) lowered by dietary AIPH2%−8%). The albumin level and hepatorenal functioning parameters (aspartate aminotransferase, alanine aminotransferase, and creatinine) were not significantly (p > 0.05) altered by AIPH diets. Additionally, AIPH diets did not adversely alter the histology of the hepatic, renal or splenic tissues with moderately activated melanomacrophage centres. The mortality rate among S. agalactiae‐infected fish declined as dietary AIPH levels rose, where the highest survival rate (86.67%) was found in the AIPH8 group (p < 0.05). Based on the broken line regression model, our study suggests using dietary AIPH at the optimal level of 6%. Overall, dietary AIPH inclusion enhanced the growth rate, economic efficiency, health status, and resistance of Nile tilapia to the S. agalactiae challenge. These beneficial impacts can help the aquaculture sector to be more sustainable.