Consumption of meat and meat products may lead to health risks such as cardiovascular diseases due to the significant amount of animal fat in the formulation. Thus, various strategies have been studied to reduce saturated fat without altering the physicochemical and sensory qualities of meat products, including incorporating food additives. Kappaphycus alvarezii is a tropical red macroalga with significant fibre, carbohydrate, and mineral content. This study aims to see how replacing fat in chicken patties with seaweed gel K. alvarezii (KA) affects the physicochemical, nutritional, and sensory aspects. The chicken patties were formulated as control samples F0 (0% KA gel + 10% fat), F1 (2.5% KA gel + 7.5% fat), F2 (5% KA gel + 5% fat), and F3 (7.5% KA gel + 2.5% fat). Adding K. alvarezii significantly increased patty moisture, ash, and dietary fibre content (p < 0.05). On the other hand, increasing the level of K. alvarezii gel as a fat replacer considerably lowered the fat content (p < 0.05). Furthermore, adding K. alvarezii gel did not impact the protein content (p > 0.05). The hardness of the K. alvarezii gel-treated patties decreased significantly (p < 0.05) with no significant changes in other textural parameters (p > 0.05). When compared to the control sample (F0), the chicken patties with K. alvarezii gel seaweed exhibit lower expressible water and cooking loss (p < 0.05). The addition of seaweed gel darkened the colour of the chicken patties while decreasing the a* and b* values (p < 0.05). Compared to other formulations, F1 (2.5% KA gel + 7.5% fat) is most liked by sensory panellists (p < 0.05). In conclusion, seaweed K. alvarezii gel has the potential to be used as a fat substitute in the production of reduced-fat chicken patties.