The aim of this paper is to advance the research on the use of alkali-activated fly ash in recycled concrete aggregate (RCA) bearing mortar (RAM) to achieve low carbon footprint and sustainability in construction. To this end, the present paper explores the advantages in terms of improved properties of RAM by incorporating fly ash with an alkali-silicate activator. Results of testing reveal that compressive strength of RAM is improved by more than 30% by using 20% fly ash with 3–6% silicate-activator. RAM with activated-fly ash showed significant improvement in resistance against water absorption, chloride penetration, and acid attack. The durability parameters are fairly correlated with the compressive strength: improvement in durability performance is noticed with increasing compressive strength, indicating that microstructural developments that yield high mechanical strength also contribute to improvement in durability.