Functional properties and antioxidative activity of a protein hydrolysate prepared from toothed ponyfish (Gazza minuta) muscle, using viscera extract from hybrid catfish (Clarias macrocephalus × Clarias gariepinus), with a degree of hydrolysis (DH) of 70%, were investigated. The protein hydrolysate had a good solubility. It was soluble over a wide pH range (3–9), in which more than 77% solubility was obtained. The emulsifying activity index of the protein hydrolysate decreased with increasing concentration (P < 0.05). Conversely, the foaming abilities increased as the hydrolysate concentrations increased (P < 0.05). Protein hydrolysate exhibited the increases in 2,2-diphenyl-1-picrylhydrazyl (DPPH), 2,2-azino-bis(3-ethylbenzothiazoline-6-sulphonic acid) (ABTS) radical scavenging activities, ferric reducing power (FRAP) and metal chelating activity as hydrolysate concentration increased (P < 0.05). ABTS radical scavenging activity of protein hydrolysate was stable when heated at 100 °C for 180 min and subjected to a wide pH range (1–11). Therefore, protein hydrolysate from the muscle of toothed ponyfish produced by viscera extract from hybrid catfish can be used as a promising source of functional peptides with antioxidant properties.