In this study, shrimp waste was enzymatically hydrolyzed to generate a green dispersant and the product was tested for crude oil dispersion in seawater. The hydrolysis process was first optimized based on the dispersant effectiveness (DE) of the product. The functional properties of the product were identified including stability, critical micelle concentration, and emulsification activity. Water was confirmed as a good solvent for dispersant generation when compared with three chemical solvents. The effects of salinity, mixing energy, and temperature on the dispersion of the Alaska North Slope (ANS) crude oil were examined. Microtox acute toxicity test was also conducted to evaluate the toxicity of the produced dispersant. In addition, DE of the product on three different types of crude oil, including ANS crude oil, Prudhoe Bay crude oil (PBC), and Arabian Light crude oil (ALC) was compared with that of the Corexit 9500, respectively. The research output could lead to a promising green solution to the oil spill problem and might result in many other environmental applications.