This study investigates the application of foam asphalt (FA) to enhance the compaction effectiveness of a hot in-place recycling asphalt mixture (HIR-AM) during the HIR process of old road surfaces. Initially, the process parameters for FA preparation were determined through expansion-rate and half-life tests. Subsequently, the study focused on evaluating the impact of FA on the compaction quality of HIR-AM. Performance assessments were conducted through rutting tests, low-temperature bending tests, Hamburg wheel tracking tests, dynamic modulus analyses, and various other experiments to evaluate the road performance of HIR-FAM. Finally, the research findings were validated through practical engineering applications, and the construction process for HIR-FAM was summarized. The research results reveal that the optimal foaming temperature for SBS asphalt is 170 °C, with an ideal water content of 1.7%. Under the same compaction temperature, HIR-FAM demonstrated a significant reduction in void content, ranging from 3.8% to 21.2% compared to HIR-AM. Moreover, a higher proportion of FA usage resulted in a more substantial decrease in void content. Compared to HIR-AM, HIR-FAM exhibited notable improvements, including an 11.6% increase in dynamic stability, a 13.4% enhancement in bending strength, a 13.3% increase in maximum bending strain, an 8.1% improvement in residual stability, and an 8.5% boost in freeze–thaw splitting strength. Furthermore, HIR-FAM demonstrated superior water-thermal stability and resistance to low-frequency loads. Paving a test road verified that the adoption of foam asphalt in thermal recycling led to a compaction density increase of over 0.79% compared to traditional in situ thermal recycling sections, with improved compaction uniformity.