Chitosanases play a significant part in the hydrolysis of chitosan to form chitooligosaccharides (COS) that possess diverse biological activities. This study aimed to enhance the productivity of Paenibacillus elgii TKU051 chitosanase by fermentation from chitinous fishery wastes. The ideal parameters for achieving maximum chitosanase activity were determined: a squid pens powder amount of 5.278% (w/v), an initial pH value of 8.93, an incubation temperature of 38 °C, and an incubation duration of 5.73 days. The resulting chitosanase activity of the culture medium was 2.023 U/mL. A chitosanase with a molecular weight of 25 kDa was isolated from the culture medium of P. elgii TKU051 and was biochemically characterized. Liquid chromatography with tandem mass spectrometry analysis revealed that P. elgii TKU051 chitosanase exhibited a maximum amino acid identity of 43% with a chitosanase of Bacillus circulans belonging to the glycoside hydrolase (GH) family 46. P. elgii TKU051 chitosanase demonstrated optimal activity at pH 5.5 while displaying remarkable stability within the pH range of 5.0 to 9.0. The enzyme displayed maximum efficiency at 60 °C and demonstrated considerable stability at temperatures ≤40 °C. The presence of Mn2+ positively affected the activity of the enzyme, while the presence of Cu2+ had a negative effect. Thin-layer chromatography analysis demonstrated that P. elgii TKU051 chitosanase exhibited an endo-type cleavage pattern and hydrolyzed chitosan with 98% degree of deacetylation to yield (GlcN)2 and (GlcN)3. The enzymatic properties of P. elgii TKU051 chitosanase render it a promising candidate for application in the production of COS.