Abstract(Phosphor‐converted white laser diode (PC‐WLD) lighting shows promise for high‐luminance solid‐state illumination. However, luminescence saturation, stemming from optical and thermal factors and, hampers high‐power LD lighting progress. This study delves into the light‐thermal dynamics between lasers and Y3Al5O12:Ce3+ (YAG:Ce)transparent ceramic phosphors (TCPs). Over 48.9% of absorbed laser power generates heat, inducing luminescence saturation. To effectively handle heat dissipation, we introduce a Luminescence‐Refrigeration Module (LRM) comprising the YAG:0.005Ce3+ TCP and a thermoelectric cooler (TEC). The LRM raises laser power density saturation by 4.5 times, meeting high‐power laser lighting requirements. The designed LRM emerges as a groundbreaking strategy for advancing high‐power LD lighting devices.)