This study investigated the potential of ethanolic garlic extract-loaded chitosan hydrogel film for burn wound healing in an animal model. The ethanolic garlic extract was prepared by macerating fresh ground garlic cloves in ethanol for 24 h, followed by filtration and concentration using a rotary evaporator. Hydrogels were then prepared by casting a chitosan solution with garlic extract added at varying concentrations for optimization and, following drying, subjected to various characterization tests, including moisture adsorption (MA), water vapor transmission rate (WVTR), and water vapor permeability rate (WVPR), erosion, swelling, tensile strength, vibrational, and thermal analysis, and surface morphology. The optimized hydrogel (G2) was then analyzed in vivo for its potential for healing 2nd degree burn wounds in rats, and histological examination of skin samples on day 14 of the healing period. Results showed optimized hydrogel (G2; chitosan: 2 g, garlic extract: 1 g) had MA of 56.8% ± 2.7%, WVTR and WVPR of 0.00074 ± 0.0002, and 0.000 498 946 ± 0.0001, eroded up to 11.3% ± 0.05%, 80.7% ± 0.04% of swelling index, and tensile strength of 16.6 ± 0.9 MPa, which could be attributed to the formation of additional linkages between formulation ingredients and garlic extract constituents at OH/NH and C=O, translating into an increase in transition melting temperature and enthalpy (ΔT = 238.83 °C ± 1.2 °C, ΔH = 4.95 ± 0.8 J g−1) of the chitosan moieties compared with blank. Animal testing revealed G2 formulation significantly reduced the wound size within 14 d of the experiment (37.3 ± 6.8–187.5 ± 21.5 mm2) and had significantly higher reepithelization (86.3 ± 6.8–26.8 ± 21.5 and 38.2% ± 15.3%) compared to untreated and blank groups by hastening uniform and compact deposition of collagen fibers at the wound site, cementing developed formulation a promising platform for skin regeneration.