Inland saline water aquaculture represents an emerging frontier for ornamental fish production, yet the physiological thresholds of commercially important species remain poorly characterised. This study investigated the salinity tolerance, growth, reproductive performance, colouration, and survival of swordtail (Xiphophorus hellerii) across a 90-day experimental period at salinities of 0, 2, 4, 6, 8, and 12 ppt. Physicochemical analyses confirmed positive correlations among salinity, electrical conductivity, sodium (Na⁺), and chloride (Cl⁻) concentrations. Fish maintained a survival rate exceeding 80% and exhibited no significant growth impairment at salinities up to 8 ppt, with optimal swimming and feeding behaviour recorded at this level. Reproductive indices, including gonadosomatic index (GSI), ovarian weight, fecundity, fry output, and survival rate, demonstrated strong polynomial relationships with salinity, peaking at 8 ppt. Similarly, carotenoid content and digital colourimetric analyses revealed a decline in pigmentation beyond 8 ppt. At elevated salinities of 10–12 ppt, significantly elevated plasma cortisol and glucose levels indicated acute physiological stress, which was further corroborated by significant alterations in antioxidant enzyme activities (SOD, CAT, GR) and oxidative stress markers (LPO), along with disturbances in hepatic enzymes (AST, ALT) and osmoregulatory function (Na⁺/K⁺-ATPase). Collectively, these findings establish 8 ppt as the optimal salinity threshold for productive, welfare-compatible swordtail culture in inland saline systems, providing a science-based guideline for their commercial ornamental production.