To improve the capability of nanosecond lasers to process structures with a high aspect ratio, a new method of nanosecond laser processing in closed flowing water was proposed in this paper. The microgrooves on a stainless steel 304 surface were processed by the new method, and the influence of processing parameters on the microgrooves was studied. The comparative experiments of laser processing in still water and overflowing water were also carried out, and the unusual phenomenon of laser processing in different flowing water was discovered by a high-speed camera. The results showed that the flowing velocity played a crucial role in underwater laser processing, and that high flowing velocity could timely remove bubbles in closed flowing water, thus obtaining higher processing efficiency. As the depth of the groove increased, the bubbles firstly affected the processing of the sidewall, causing a circular transition between the sidewall and bottom surface. The reflection of the laser beam by the bubble could cause secondary processing on the sidewall, resulting in a decrease in the taper angle. Based on the above research, the microgroove with a width of 0.5 mm, aspect ratio of 3, and taper angle of 87.57° was successfully processed by a nanosecond laser in closed flowing water. Compared to conventional nanosecond laser processing, laser processing in closed flowing water was more advantageous in processing microgrooves with a small taper angle and high aspect ratio.