Chronic wound infections, particularly those caused by antibiotic-resistant Staphylococcus aureus, represent a major global health burden, necessitating advanced naturally derived wound dressings with intrinsic antibacterial activity. This study aimed to fabricate a novel composite hydrogel scaffold based on sodium alginate, keratin, and Althaea officinalis extract, and identify the optimal formulation for wound dressing applications. Three alginate-to-keratin weight ratios (70:30, 50:50, and 30:70) were fabricated via ionic crosslinking with CaCl₂ followed by freeze-drying, and each formulation was loaded with Althaea officinalis extract at 0%, 2.5%, 5%, 8%, and 10% (w/v). Scaffolds were characterized for morphology (SEM), chemical interactions (FTIR), swelling ratio, in vitro biodegradation (27 days), water vapor transmission rate (WVTR), water solubility, and antibacterial activity against S. aureus, E. coli, and P. aeruginosa. SEM revealed interconnected porous networks with pore diameters of 200–400 µm, with the A70:K30 formulation exhibiting the most uniform distribution (280 ± 35 µm). FTIR confirmed successful integration of all three components, with hydrogen bonding between alginate and keratin and physical entrapment of phenolic compounds (1510, 1450 cm⁻¹). The A70:K30 formulation with 10% extract demonstrated superior performance: swelling ratio of 2350 ± 120% (vs. 1850 ± 95% without extract, p < 0.01), biodegradation of 82 ± 5% at day 27, WVTR of 425 ± 22 g/m²·h, and solubility of 21 ± 2.8%. Antibacterial activity was selective against Gram-positive S. aureus. The A70:K30 with 10% extract produced the largest inhibition zone (18.0 ± 1.2 mm), comparable to gentamicin (19.5 ± 1.0 mm), and the MIC of the hydrogel-eluted extract against S. aureus was 10 mg/mL. In conclusion, the A70:K30 hydrogel scaffold loaded with 10% Althaea officinalis extract exhibits optimal physicochemical properties and potent anti-staphylococcal activity comparable to standard antibiotics, positioning it as a promising naturally derived, cost-effective, and biocompatible wound dressing for managing infected chronic wounds.