(1) Background: Running is one of many sports that have increased in popularity since it can be conducted at any time or anywhere. Ankle instability is a common injury that usually occurs during running and is usually associated with abnormalities in postural stability. Recently, kinesio taping has gained increasing interest as a tool that can be used in rehabilitation, to improve stability, and to help in injury prevention. This study aimed to investigate the effect of Kinesio taping on balance and dynamic stability in recreational runners with ankle instability. (2) Methods: This randomized controlled trial recruited 90 RRs with ankle instability. The participants were randomly divided into three equal groups: a KT group (KTG) who received Kinesio taping on their ankle joints; a mixed group (MG) who received Kinesio taping and exercises; and an exercise group (EG) who received exercises only. Outcome measures (balance and dynamic stability) were assessed before and after the end of an 8-week treatment program using a Biodex balance system and a star excursion balance test, respectively. (3) Results: Within-group comparisons showed statistically significant improvements in most of the outcome values when compared to baseline. Overall stability index was statistically significantly better (with a high effect size) in the MG compared to KTG or EG (p= 0.01, Cohen’sd= 1.6, andp< 0.001, Cohen’sd= 1.63, respectively). A similar finding was evident in the anteroposterior stability index (p= 0.02, Cohen’sd= 0.95, andp< 0.001, Cohen’sd= 1.22, respectively). The mediolateral stability index of the KTG was statistically significantly better with a high effect size when compared to MG or EG (p= 0.04, Cohen’sd= 0.6, andp< 0.01, Cohen’sd= 0.96, respectively). The star excursion balance test values were statistically significant with high effect sizes in the posterior (p= 0.002, Cohen’sd= 1.2) and lateral (p< 0.02, Cohen’sd= 0.92) directions in the MG compared to KTG and EG. (4) Conclusions: Kinesiotape with exercises is superior to either kinesiotape alone or exercises alone in improving postural stability indices and dynamic stability in recreational runners with ankle instability. Recreational runners with ankle instability should be educated about practicing balance exercises and applying kinesiotape.