Facing severe climate change, preserving the environment, and promoting sustainable development necessitate innovative global solutions such as waste recycling, extracting value-added by-products, and transitioning from traditional to renewable energy sources. Accordingly, this study aims to repurpose fish waste into valuable, nutritionally rich products and extract essential chemical compounds such as proteins and oils using a newly developed hybrid solar dryer (HSD). This proposed HSD aims to produce thermal energy for drying fish waste through the combined use of solar collectors and solar panels. The HSD, primarily composed of a solar collector, drying chamber, auxiliary heating system, solar panels, battery, pump, heating tank, control panel, and charging unit, has been designed for the effective drying of fish waste. We subjected the fish waste samples to controlled drying at three distinct temperatures: 45, 50, and 55 °C. The results indicated a reduction in moisture content from 75.2% to 24.8% within drying times of 10, 7, and 5 h, respectively, at these temperatures. Moreover, maximum drying rates of 1.10, 1.22, and 1.41 kgH2O/kg dry material/h were recorded at 45, 50, and 55 °C, respectively. Remarkable energy efficiency was also observed in the HSD’s operation, with savings of 79.2%, 75.8%, and 62.2% at each respective temperature. Notably, with an increase in drying temperature, the microbial load, crude lipid, and moisture content decreased, while the crude protein and ash content increased. The outcomes of this study indicate that the practical, solar-powered HSD can recycle fish waste, enhance its value, and reduce the carbon footprint of processing operations. This sustainable approach, underpinned by renewable energy, offers significant environmental preservation and a reduction in fossil fuel reliance for industrial operations.