Laser hyperthermia therapy (HT) has emerged as a well-established method for treating cancer, yet it poses unique challenges in comprehending heat transfer dynamics within both healthy and cancerous tissues due to their intricate nature. This study investigates laser HT therapy as a promising avenue for addressing skin cancer. Employing two distinct near-infrared (NIR) laser beams at 980 nm, we analyze temperature variations within tumors, employing Pennes’ bioheat transfer equation as our fundamental investigative framework. Furthermore, our study delves into the influence of Ytterbium nanoparticles (YbNPs) on predicting temperature distributions in healthy and cancerous skin tissues. Our findings reveal that the application of YbNPs using a Gaussian beam shape results in a notable maximum temperature increase of 5 °C within the tumor compared to nanoparticle-free heating. Similarly, utilizing a flat top beam alongside YbNPs induces a temperature rise of 3 °C. While this research provides valuable insights into utilizing YbNPs with a Gaussian laser beam configuration for skin cancer treatment, a more thorough understanding could be attained through additional details on experimental parameters such as setup, exposure duration, and specific implications for skin cancer therapy.