The Red Devils now sit atop Group C with seven points, a comfortable two-point lead over South Africa's Orlando Pirates.
Belouizdad remain in third place with three points, edging out Stade d'Abidjan of Cote d’Ivoire by two points.
From the onset, hosts Ahly applied intense pressure, but it was Aymen Mahious of Belouizdad who broke the deadlock in the 21st minute.
The Algerian winger capitalized on a precise assist from Abderrahmane Meziane within the box, catching Ahly's goalkeeper El-Shennawy off guard.
However, just before halftime, Palestinian striker Wessam Abou Ali leveled the score for Ahly with a well-placed finish inside the penalty area, concluding the first half at 1-1.
The second half saw Ahly elevate their game to new heights, delivering a resounding victory for Egyptian football over their Algerian counterparts.
Abou Ali netted his second goal from a free kick outside the box in the 52nd minute, followed by winger Hussien El-Shahat's strike in the 56th minute.
The Palestinian striker completed his hat-trick six minutes before the final whistle, extinguishing any hopes of a Belouizdad comeback.
The visitors pressed forward leaving acres of spaces at the back, and they were punished for that.
Substitute Percy Tau then added a fifth goal with a low shot from the edge of the area.
Emam Ashour, the man orchestrated Ahly's second half display, put the icing on the cake with a powerful strike from outside the box to wrap up a 6-1 scoreline.
The result is the largest victory for any Egyptian side over an Algerian team.
Next up, Ahly are set to clash with Belouizdad once again in the fourth round of Group C fixtures on 3 January in Algeria.
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