Macrotyloma uniflorum (L.) Verdc., commonly known as Horsegram (HG), is a drought-tolerant, nutrient-dense legume. Rich in protein (22–25%), lysine, and micronutrients like calcium, iron, and phosphorus, HG also contains bioactive compounds with antioxidant, antidiabetic, and anti-inflammatory properties. Despite its nutritional value, HG remains underutilized due to limited processing technologies and low consumer awareness. Protein hydrolysates (PH), particularly those derived via enzymatic hydrolysis, are gaining prominence for their enhanced digestibility, bioavailability, and functional properties. Enzymatic hydrolysis produces peptides with defined molecular weights and specific amino acid compositions, offering advantages over free amino acid-based formulations in clinical and functional food systems. These hydrolysates are increasingly incorporated into high-protein snacks, therapeutic diets, and geriatric nutrition. This study focuses on the enzymatic hydrolysis of HG protein (HG-PH), exploring its structural characteristics via FTIR spectroscopy and their implications on functional properties such as solubility, water/oil-holding capacity, and emulsification. While enzymatic hydrolysis has demonstrated improvements in lentil protein functionality its application to HG is underexplored. Given the growing demand for sustainable, plant-based proteins, HG-PH presents a valuable alternative with both nutritional and techno-functional advantages. Its integration into food systems ranges from dairy alternatives to protein-enriched snacks that can enhance product quality while supporting health-promoting benefits through bioactive peptides. This study aims to bridge knowledge gaps and unlock the potential of HG-PH as a sustainable ingredient for modern food innovation.