Kappaphycus alvarezii is one of the most important commercial sources of carrageenan. Red seaweeds are found in tropical areas, and K. alvarezii is famous for its high growth rate among other tropical red seaweeds. This study was conducted to produce Kapparazii powderTM, a product comprised of high amount of carrageenan with valuable nutrients from K. alvarezii found in Sabah, Malaysia. Spray drying and an environmentally friendly process without using chemicals were employed to produce Kapparazii powderTM. Physicochemical properties of Kapparazii powderTM such as proximate composition (moisture, protein, lipid, ash, and crude fiber), mineral content, heavy metals, vitamins, amino acid, color, viscosity, gel strength, swelling capacity, and water and oil holding capacity were evaluated. Kapparazii powderTM contained moisture (4.69 ± 0.03 %), protein (5.11 ± 0.02 %), lipid (1.00 ± 0.02 %), ash (14.52 ± 0.01 %), and crude fiber (0.93 ± 0.02 %). Color analysis of Kapparazii powderTM showed that lightness (L*) = 89.51 ± 0.02, redness (a*) = −1.27 ± 0.03, and yellowness (b*) = 5.49 ± 0.02. The value of viscosity, gel strength, swelling capacity, and water and oil holding capacity of the Kapparazii powderTM were 0.06 ± 0.00 Pa.s, 82.77 ± 3.66 gf, 100 ± 0.00 mL.g−1, 4.67 ± 0.58 g.g−1, and 5.11 ± 0.36 g.g−1, respectively. Moreover, Kapparazii powderTM did not inhibit proliferation of L929 cells after 24 h of exposure at the highest concentration (2 mg.mL−1). In conclusion, the Kapparazii powderTM as a source of high nutrient hydrocolloid suggested on the point of healthy ingredient for food industry application.