We propose a novel approach to enhance magnon bistability and magnon–phonon entanglement in a microwave cavity containing a driving atomic ensemble and a ferrimagnetic crystal of yttrium iron garnet (YIG), where the cavity is simultaneously coupled with the magnon and atoms while the magnon couples to phonon through magnetostrictive interaction. When the magnon-atom coherent coupling is established via the exchange of virtual photon, it is of interest that the magnon bistability is significantly enhanced by the vacuum induced coherence (VIC) from the atomic spontaneous. Moreover, the magnon–phonon entanglement that arises from parametric and beam-splitter interactions are also enhanced, wherein the atomic ensemble acts as a reservoir to cooling the magnon and phonon further. The present scheme provides a feasible way to control the nonlinear magnon–phonon coupling strength by quantum interference, which may be useful for macroscopic quantum information processing.