Second-grade watermelons are a lycopene-rich byproduct currently discarded despite their functional potential. This study aimed to develop a consumer-accepted liqueur by alcohol maceration of watermelon pulp, optimizing formulation for lycopene retention, antioxidant activity, and sensory quality. Three pulp ratios (15, 20, and 25% v/v) were macerated in 39% v/v cane alcohol for 5 days at 20 °C. The 20% pulp formulation (T2) achieved the best balance of lycopene (8.6 mg L⁻¹), DPPH antioxidant activity (580 µmol TE L⁻¹), redness (CIE a* = 14.1), and overall acceptability (7.6/9). Under nitrogen-flushed amber glass, T2 retained ≥82% lycopene and ≤10% antioxidant loss after 90 days at 20 °C, following first-order degradation kinetics (Ea = 43 kJ mol⁻¹). A 5,000 L yr⁻¹ craft-scale projection showed a 1.9-year payback and 1.7 t CO₂-eq savings compared to landfill. These findings demonstrate the feasibility of producing a shelf-stable, functional liqueur from watermelon waste, aligning with consumer preferences and circular economy principles in the craft beverage sector.