In this study, the effect of B-type S-hydrides (with near-basal habit planes) on the low-cycle fatigue (LCF) behavior of Ti-2Al-2.5Zr alloy was studied through in-situ SEM fatigue testing. Tensile tests, in-situ observation of fatigue testing and post-fatigue microstructure examination demonstrated that the B-type S-hydrides not only exerted a hindering effect on slip but were also capable of undergoing plastic deformation in conjunction with the matrix, without fracturing. The slip behavior of dislocations across the phase interface was discussed. An increase in hydrogen content (or B-type S-hydrides) led to an extension of the LCF life of Ti-2Al-2.5Zr alloy. This was primarily achieved by prolonging the crack initiation life, whereas it had a relatively minor effect on the crack propagation life. The enhancement of crack initiation life could be attributed to the retardation of cyclic plastic strain accumulation and strain incompatibility, both being outcomes of the hindering effect of hydrides on slip. During the crack propagation stage, there was no change in the crack propagation mode (transgranular mode) with increasing hydrogen content. Additionally, no cases of rapid crack propagation along the S-hydrides were detected. These could be attributed to the plastic deformation capacity exhibited by the B-type S-hydrides, and their perpendicular orientations relative to the crack propagation direction. Therefore, the B-type S-hydrides exhibited a minor impact on the crack propagation life. It is believed that this study provides an insight into the influence of the B-type S-hydrides on the LCF behavior of Ti-2Al-2.5Zr alloy.