Hot phonon bottleneck (HPB), one of the dominant effects for tuning hot carrier (HC) cooling, has been extensively studied in lead halide perovskites (LHP), and most attention has been devoted to its role in those photovoltaic devices. However, behaviors of HPB in strongly confined systems and its influence on optical gain remain obscure. Herein, by monitoring state-resolved relaxation in strongly confined CsPbBr3 quantum dots (QDs), we discover a discrete cooling process of HCs and demonstrate that their elongation, induced by HPB, primarily occurs during the intraband relaxation from the first excited (1P) to the lowest (1S) states. Moreover, a threshold-like character of HPB in LHP QDs, where the energy dissipation rate significantly drops only beyond a certain carrier density, could be ascribed to the nonadiabatic interaction by coupling with ligand vibrations. Remarkably, HPB has been found to trigger the formation of a giant optical gain (6000 cm–1) near the second absorption peak, and spectral analysis indicates its origin from population inversion at the higher-transition or 1P state. Our findings could strengthen the understanding of photophysics in LHP QDs and guide the development of efficient and broadband lighting applications.