Beta phase gallium oxide (β-Ga2O3) is emerging as a promising material for space applications due to its unique properties and potential high performance in extreme environments. In this work, we systematically study the impact of β-Ga2O3 Schottky barrier diodes (SBDs) under a high fluence neutron irradiation to explore the degradation mechanism of the devices. After irradiated by neutrons with an average energy of 1–2 MeV and a dose rate of 1.3 × 1012 cm−2 s−1, SBDs with a homoepitaxial layer suffered serious performance degradation. The main manifestation of this degradation was a substantial increase in on-resistance, which rose from 3.9 to 3.5 × 108 mΩ·cm2 under the aforementioned irradiation conditions. The appearance of amorphous/polycrystalline striped lattice damage in the epitaxial layer as well as the presence of deep-level defects caused by oxygen vacancies are factors related to this phenomenon. The simulation revealed that the capture reaction of neutrons and Ga elements is the primary cause of neutron irradiation. This reaction generates high-energy beta- particles (β-particles) resulting in the formation of defects. This paper reveals the degradation mechanism of β-Ga2O3 SBDs under neutron irradiation and provides a possible design roadmap for radiation-resistant β-Ga2O3 power devices. Moreover, a high-temperature oxygen annealing process was implemented, which proved to be in restoring the device performance.