The aquafeed industry increasingly relies on using sustainable and appropriate protein sources to ensure the long-term sustainability and financial viability of intensive aquaculture. Yeast has emerged as a viable substitute protein source in the aquaculture sector due to its potential as a nutritional supplement. A substantial body of evidence exists to suggest that yeast has the potential to act as an effective immune-stimulating agent for a range of aquaculture fish species. Furthermore, the incorporation of yeast supplements and feed additives has the potential to bolster disease prevention, development, and production within the aquaculture sector. Except for methionine, lysine, arginine, and phenylalanine, which are typically the limiting essential amino acids in various fish species, the various yeast species exhibit amino acid profiles that are advantageous when compared to fishmeal. The present review considers the potential nutritional suitability of several yeast species for fish, with particular attention to the various applications of yeast in aquaculture nutrition. The findings of this study indicate that the inclusion of yeast in the diet resulted in the most favorable outcomes, with improvements observed in the overall health, growth performance, and nutritional condition of the fish. Digestibility, a key factor in sustainable feed development, is discussed in special detail. Additionally, this review addresses the utilization of yeast as an immunostimulating agent for fish and its digestion in fish. Furthermore, the research emphasizes the necessity of large-scale production of yeast as a substitute for fishmeal in aquaculture.