The unsatisfactory performance of unreinforced masonry (URM) buildings during seismic events has led the research community to explore various strengthening techniques. However, most techniques used are based on external strengthening and are not easy to implement in real-life situations. Therefore, the current study focuses on improving the seismic behavior of masonry structures through the incorporation of a novel fiber-reinforced mortar in construction. Two different waste fibers, i.e., coir and nylon fibers, were used as reinforcement in the mortar, and the same mortar was used for both mortar joints and plaster. The objective is to improve the seismic performance of URM buildings while reducing carbon footprint and landfill problems. The scale-down building models were built with both clay and fly ash bricks. Then, these building models were subjected to seismic loading through a bi-axial shake table. The failure mechanism of the models was thoroughly examined. Furthermore, the seismic performance of both types of building models was assessed using various parameters, including failure pattern, crack formation, maximum sustained peak ground acceleration (PGA), arias intensity, acceleration amplification factor, energy flux ratio, etc. It was observed that the strengthened masonry models sustained significantly higher seismic loading (up to 45.5% in terms of first crack strength) than their unreinforced counterparts. The failure of strengthened models was ductile, and these strengthened models successfully avoided the sudden and brittle failure of URM models. There was also a notable improvement in the other parameters mentioned above. Overall, the current study's strengthening technique proved effective, sustainable, easy to implement, and economical.