The present study deals with the first systematic study on the isolation, characterization, and utilization of marine yeast for bioethanol production using seaweed biomass. The ability and efficiency of isolated marine yeast to grow and ferment sugar to ethanol in the presence of 2.5 % to 15 % salt concentration was validated by fermenting galactose in the presence of different salts at varied concentrations. Successively, this yeast was employed for fermentation of seaweed hydrolysate, containing high salt concentration, to ethanol. The hydrolysate having varying sugar as well as salt contents, from 2.7 % to 5.5 % and from 6.25 to 11.25 %, respectively, yielded 1.23–1.76 % ethanol. Through biochemical, fatty acid methyl ester analysis, and BioLog, the yeast was identified as Candida sp. The ability of this yeast to function at high salinity can be commercialized for its use to convert seaweed polysaccharide based hydrolysate, rich in salt, to ethanol without desalting process, ultimately making the process more efficient and economically viable. This is the first organized study for the utilization of marine yeast for converting Kappaphycus alvarezii, a red algal biomass, into ethanol as a byproduct, under highly saline condition.