Heavy metals including cadmium (Cd) are one of the major persistent and non-biodegradable wastewater pollutants. However, Cd reaches the aquatic ecosystem via industrial and agricultural waste discharges and causes serious deterioration in the welfare status of aquatic animals. The use of feed supplements with immune-stimulants to mitigate the toxic influences of heavy metals including Cd is a much more intriguing point. Thus, the current experiment used the bio-synthetized chitosan nanoparticles derived from Bacillus subtilis (Bs-CNPs) as a feed supplement and evaluated its ameliorative impacts on the growth and welfare status of Cd-intoxicated Nile tilapia (Oreochromis niloticus). Bifactorial design (3 Bs-CNPs levels × 3 Cd levels) was used in the current study where Nile tilapia fingerlings (58–63 g) were fed on 0.0, 2, and 4 g Bs-CNPs/kg feed alongside with exposing to 0.0, 0.392, and 0.784 mg Cd/L for 60 days to represent nine treatments as follows: T1: control group (no Cd exposure; no Bs-CNPs supplement); T2 and T3: fish were intoxicated with 0.784 and 0.392 mg Cd/L, respectively; T4 and T5: fish fed on 2 and 4 g Bs-CNPs/kg feed, respectively; T6 and T7: fish were fed on 2 g Bs-CNPs/kg feed along with exposure to 0.784 and 0.392 mg Cd/L, respectively; and T8 and T9: fish were fed on 4 g Bs-CNPs/kg feed along with exposure to 0.784 and 0.392 mg Cd/L, respectively. It is noted that the Cd-intoxicated fish exhibited significant retardation in growth performance and digestive enzyme activities with a decline in their survival rate compared to the control group (T1). The results also revealed that exposing fish to Cd toxicity alone with no feed supplement (T2 and T3) experienced abnormal clinical signs and behavioral changes. Compared with the control group (no Cd with no Bs-CNPs), highest values of cortisol, glucose, aspartate and alanine aminotransferase, and acetylcholine esterase activity were found in fish fed on the control diet along with exposure to 0.784 mg Cd/L. Higher Cd restudies in liver, intestine, gills, kidney, and muscles tissues were detected in fish exposed to 0.784 mg Cd/L alone and the sequence order of Cd levels in different fish organs is intestine > gills > liver > kidney > muscles. Remarkable pathological alterations in hepatic and intestinal tissues were also observed. On the other hand, feeding Nile tilapia on Bs-CNPs-enriched diets alone with no Cd exposure enhanced their growth performance, digestive enzyme activities, and hematological parameters with no Cd residues in fish organs. Interestingly, feeding the Cd-intoxicated fish on diets with Bs-CNPs (4 g/kg feed) returned their growth, digestive enzymes, hematological, and biochemical parameters to approximate those of the control group. Furthermore, these treatments showed histopathological alteration recovery in the intestine and liver tissues is similar to those in the control group (no Cd with no Bs-CNPs). Fish fed on Bs-CNPs levels with no Cd exposure showed no Cd residues in different fish organs. The Cd levels in different organs of fish exposed to 0.392 mg Cd/L along with feeding on Bs-CNPs (4 g/kg feed) were lower than those in Cd-exposed fish treatments. Consequently, the current study evoked that feeding Nile tilapia fingerlings on Bs-CNPs (4 g/kg feed) could enhance their growth performance and protect the fish from the Cd toxicity that may occur in the aquatic ecosystem.