Algae are a rich yet underexploited marine biomass that contains unique polysaccharides (e.g., laminarin, fucoidan, alginate, ulvan, porphyran) and phenolics, which can be biotransformed through fermentation into health-oriented products. This review synthesizes studies on algae fermentation aimed at animal and human health, focusing on (i) the main algal species fermented so far, (ii) fermentation modalities and conditions, (iii) in vivo health benefits of fermented algae, and (iv) reported in vitro impacts on humans and animal models. Across lactic acid, acetic/yeast (kombucha), submerged, and semi-solid fermentations, consistent trends include partial depolymerization of sulfated polysaccharides, enrichment of organic acids and bioactive phenolics, and generation of peptides and exopolysaccharides. Although in vitro assessments of fermented algae are often constrained by inconsistent methodologies and weak translational value to in vivo systems, they have unveiled a broad range of beneficial biological activities. Among these, the antioxidant, anti-inflammatory, and immune-stimulating effects suggest significant potential for improving health. While direct human in vivo studies on the effects of fermented algae are limited, a growing body of research utilizing animal models indicates significant health benefits, particularly concerning antioxidant activity, immunomodulatory, and potential prebiotic and microbiome-diversifying effects. Collectively, the reviewed data indicate algae fermentation as a promising route to obtain functional feed and food ingredients; however, standardized fermentation parameters, compositional fingerprints, and controlled clinical trials remain priorities.