The fish processing industry generates a substantial volume of solid waste, including fish heads, skeletons, skin, and viscera, resulting in pronounced environmental pollution. Traditionally, the waste has been repurposed into animal feed or fertilizer with limited economic value. This study aimed to employ silver carp waste as a nitrogen source for cultivating the probiotic Bifidobacterium animalis ssp. lactis BB-12 (BB-12), providing a cost-effective and culturally acceptable alternative to the traditionally expensive and religiously restricted peptone. This approach would not only decrease the load on the waste stream but also foster the cultivation of BB-12 in an environmentally friendly manner. The silver carp waste hydrolysate (SCWH) was produced through papain hydrolysis and subsequently employed as a substitute for the nitrogen source in the conventional MRS medium. This study examined the impact of SCWH on the growth, productivity of short chain fatty acids, and metabolite profile of BB-12. The findings indicated that substituting 75% of the nitrogen source with SCWH resulted in an increased proliferation of BB-12. The bacterium efficiently utilized both hydrophobic and hydrophilic amino acids, displaying a preference for oligopeptides and hydrophilic peptides. Moreover, the utilization of SCWH led to significantly (p < 0.05) higher concentrations of acetic acid in BB-12 cultures. Additionally, elevated levels of guanine and taurine, coupled with inhibiting fatty acid degradation through glycerophospholipid metabolism, played a role in the observed enhancement of BB-12 growth with SCWH substitution. The sustainability assessment demonstrated that SCWH reduced the nitrogen cost in the MRS medium by roughly 65%, resulting in a high production of short chain fatty acids. SCWH proved to be an excellent substitute for supporting BB-12 cultivation, and the proposed strategy emerges as a profitable and sustainable solution for valorizing freshwater fish waste, contributing to developing a more sustainable fish processing industry.