Fishmeal is the most expensive feedstuff in the aquafeed and one of the most environmentally limiting factor of aquaculture development. Therefore, the search for alternative protein sources is a continuous process. The present feeding trial was conducted to evaluate the effects of replacing fishmeal with zooplankton biomass meal (ZBM) on the growth performance, nutrient utilization, intestine, and liver histological changes of grey mullet, Mugil cephalus (initial weight of 0.10 ± 0.01 g). Five isoproteic (35% crude protein) and isolipidic (8% crude lipid) diets were formulated as the control diet (Z0) and the other four diets (Z25, Z50, Z75, and Z100), where 25%, 50%, 75%, and 100% of fishmeal was replaced by ZBM, respectively. After 60 days of feeding, the final weight, weight gain, and daily growth index of the grey mullet fed the Z100 diet were higher than those fed the control diet (p < 0.05). In addition, the better values of feed conversion ratio, protein efficiency ratio and lipid efficiency ratio were recorded in the fish fed with the Z100 diet. Additionally, the intestinal villus length, crypts depth, and muscle thickness were significantly improved with ZBM inclusion (p < 0.05). Meanwhile, there were no histopathological changes observed on the liver when compared with the control group. From the economic point of view, dietary substitution of fishmeal by ZBM (Z100) reduced the cost of diet formulation by 18% and the price per kg weight gain by about 40%. Overall, according to the findings of this study, substituting fishmeal with ZBM up to 100% could improve growth performance, feed utilization, gut health status, and profit ability of rearing M. cephalus juveniles.