The continuous demand for lightweight porous structures, with enhanced thermal and acoustic properties has been an important driver for the exploration of sustainable and eco-friendly materials for such applications. This research work presents the development of sustainable and improved thermal and acoustic biocomposite solution based on coconut fibres and sodium alginate designed for building applications. Different mix designs have been examined to investigate the effects of water and binder content on the mechanical performance of the samples. The biocomposite developed exhibited a maximum flexural stress and compressive stress at 10% deformation of 1 and 1.13 N mm−2 respectively, revealing a superior performance when compared to conventional mineral wool solutions used in construction. Based on the mechanical performance, a biocomposite formulation was selected for thermal and acoustic characterization. Additionally, samples with different surface geometries have been produced for improved acoustic performance. Thermal characterization revealed a thermal conductivity value of 0.091 W m⁻1 K⁻1, while a sound absorption averages (SAA) ranging between 0.46 and 0.62 was obtained, making the developed material a well-absorptive solution suitable for reverberation and echo attenuation applications, whilst offering good thermal insulation properties. The development of this innovative biocomposite highlights that a dual purpose bio-based insulation solution can be effectively produced with coconut fibre and sodium alginate, with competitive thermal and acoustic insulation properties, constituting a promising and sustainable alternative to conventional insulation solutions used in construction.