The current goal of aquaculture sector is to increase stocking densities while sustaining the aquatic animal's health. Here Nile tilapia were allocated in 27 aquaria (100L) at 3 different stocking densities: low rearing density (LRD) at -1.15 kg/m3; medium rearing density (MRD) at -2.3 kg/m3; and high rearing density (HRD) at -4.6 kg/m3. Each stocking density was fed one of 3 oregano essential oil (OEO) levels (0, 1, or 2 mL/kg) in their diets for 12 weeks. Dissolved oxygen was stable in all treatments until the 4th week, then declined from the 6th week until the end of the trial, with severe reduction in the HRD. Total ammonia, nitrite, and nitrate were markedly increased in the HRD groups, regardless dietary OEO. Stocking density was a significant factor in the final body weight (FBW), weight gain (WG), specific growth rate (SGR), and feed conversion ratio (FCR) indices of the fish, and dietary OEO was a significant factor in the FBW and WG (P < 0.05). Stocking density and dietary OEO were significant factors in hemoglobin, red blood cells, and white blood cells (WBCs) levels, and the interaction between the two factors significantly influenced the WBCs (P < 0.05). Blood cortisol, glucose, alanine aminotransferase, aspartate aminotransferase, alkaline phosphatase, urea, and creatinine increased with increasing stocking densities, with lower levels in the fish fed OEO than the fish fed the basal diet (P < 0.05). The superoxide dismutase (SOD), lysozyme, and phagocytic activities were significantly decreased with increased stocking density, but dietary OEO had no influence on SOD (P < 0.05). The nitic oxide (NO), glutathione reductase (GR), and myeloperoxidase (MPO) were significantly impacted by both the stocking density and dietary OEO (P < 0.05). Fish reared under high stocking densities and fed OEO-free diets had lower NO, GR, and MPO than fish fed dietary OEO (P < 0.05). In conclusion, the incorporation of dietary OEO is recommended to relieve the impacts of high stocking densities on Nile tilapia aquaculture.