The effects of pre-neutralized crude palm oil (NCPO) substitution for commercial refined palm oil (CRPO) on the quality of tilapia sausages were investigated. The total carotenoid content, a*, and b* values of the sausages increased with increasing NCPO content (p < 0.05). The breaking force of sausages decreased with increasing NCPO content (p > 0.05) whereas the deformation was remained constant (p > 0.05). All sausages had densely packed and compact structures as visualized by scanning electron microscope. Sausage with 50 g/100 g NCPO and 50 g/100 g CRPO was selected as the optimal formula due to the highest color, texture, and overall likeness scores without negative impacts on the odor, flavor, and taste scores. For the storage test, sausage with 50 g/100 g NCPO showed the greater a*, b*, carotenoid content and lipid oxidation than the control during storage (4 degrees C/vacuum packaging) for 4 weeks. However, TBARS and microbial quality remained in the acceptable level (TBARS < 1 mg/kg and total plate count < 4 log CFU/g) and the breaking force tended to remain unchanged throughout the storage. Therefore, the 50 g/100 g substitution of NCPO for CRPO is an alternative technique for healthier tilapia sausage production where the NCPO simultaneously behaved as a natural colorant.