Background A precise evaluation of liver reserve function in patients with hepatic alveolar echinococcosis (HAE) prior to hepatectomy could substantially increase the success rate of the operation and reduce the incidence of postoperative complications. The present study aimed to investigate the significance of the indocyanine green retention test at 15 min (ICG-R15) and the Albumin-Indocyanine Green Evaluation (ALICE) grading system in predicting severe posthepatectomy liver failure (PHLF) and postoperative mortality in HAE patients undergoing liver resection. Methods A total of 105 HAE patients undergoing hepatectomy were enrolled in this study. The value of each variable in predicting severe PHLF was evaluated by univariate and multivariate logistic regression analyses. The area under the receiver operating characteristic (ROC) curves (AUC) were calculated to evaluate the predictive ability of the Child-Pugh grade, ICG-R15, and ALICE grading system. Also, patients were classified using the optimal cutoff value for ICG-R15 and different ALICE grades, and the incidence of severe PHLF and postoperative mortality were compared with the predicted values. Results Out of the 105 HAE patients enrolled in this study, 34 patients (32.4%) developed severe PHLF. The ALICE grade and operative time were identified as independent predictors of severe PHLF. According to ROC analysis, the AUCs of the Child-Pugh grade, ICG-R15, and ALICE grade for predicting severe PHLF were 0.733 (95% confidence interval (CI), 0.637-0.814), 0.823 (95% CI, 0.737-0.891), 0.834 (95% CI, 0.749-0.900). The incidence of severe PHLF and postoperative 90-day mortality in patients with ICG-R15 > 7.2% were significantly higher than those with ICG-R15 <= 7.2% (P < 0.001; P = 0.008). Likewise, the incidence of severe PHLF and postoperative 90-day mortality in patients with ALICE grade 2 were higher than those with ALICE grade 1 within the Child-Pugh grade A (P < 0.001; P = 0.083). Conclusion ICG-R15 and ALICE grading system are powerful predictors of severe PHLF and postoperative mortality among HAE patients undergoing hepatectomy. Furthermore, a combination of the preoperative Child-Pugh grade and ALICE grading system may provide an even more precise and objective guidance and facilitate surgical decision-making for HAE patients.