Objectives: The objective of the study was to evaluate the effect of core stabilization exercises on balance and functional performance in functional ankle instability (FAI). Methods: An open-label randomized control pilot study was conducted with 30 FAI participants allocated to two groups. Inclusion criteria were the presence of frequent ankle sprains, sense of give-away of the ankle, and identification of FAI score >11. The experimental group (n = 15) received core stabilization exercises along with conventional exercises, whereas the control group (n = 15) received only conventional exercises. The intervention period was six weeks. The outcome measures for static balance, dynamic balance, and functional performance were the single-leg stance test, modified star excursion balance test (mSEBT), and side hop test, respectively. The assessment was done at baseline and six weeks post-intervention. Results: Within-group analysis showed improvement in the single-leg stance test and all direction reach distances of mSEBT in both groups using the Wilcoxon signed-rank test. Meanwhile, the side hop test revealed no difference between the two groups. A significant improvement was seen in mSEBT and single-leg stance scores (P ≤ 0.05) between the groups using the Mann–Whitney U-test. However, the side hop test showed no significant difference (P > 0.05). Conclusion: The present study concludes that core stabilization exercises improved balance compared to mobility and strengthening exercises. Hence, it is highly recommended that core stability training be implemented as a holistic approach to managing FAI.