Anaerobic digestion has attracted great interest for use in the management of organic wastes and the production of biomethane. However, this process is facing challenges, such as a high concentration of ammonia nitrogen, which affects the methanogenesis process and, thus, the production of methane. This study investigates the use of biosolid-derived biochar for mitigating ammonia stress and improving methane production during the anaerobic digestion of chicken manure, using both pristine biochar and biochar modified with a potassium hydroxide (KOH) solution. Batch mesophilic anaerobic digestion (37 °C) was carried out over 18 days. When compared to chicken-manure-only controls, a significant increase in methane formation was observed in the digesters amended with biochar and KOH-modified biochar, producing 220 L kg−1 volatile solids (VSs) and 262 L kg−1 VSs of methane, respectively, compared to 139 L kg−1 VSs from the control digesters. The use of biochar and KOH-modified biochar resulted in a significant reduction of 8 days in the lag phase. The total ammonia nitrogen (TAN) concentration was reduced in the digesters with biochar and KOH-modified biochar by 25% and 35.5%, respectively. The quantitative polymerase chain reaction (QPCR) data revealed that the number of 16S rRNA gene copies was around 50,000 and 41,000 times higher in the biochar and KOH-modified biochar digesters, respectively, compared to the control digesters on day 18. The taxonomic profiles indicated that the BC and KOH-BC digesters contained a mixture of methanogenic pathways, including acetoclastic (Methanosaetaceae), hydrogenotrophic (Methanosarcinaceae), and methylation (Methanofastidiosaceae). This mix of pathways suggests a more robust archaeal community and, hence, more efficient methanogenesis. The results show that the addition of biosolids biochar enhances anaerobic digestion, mitigates ammonia stress to methanogens, and significantly increases biogas production.