Record high field‐effect mobility (µFE) thin film transistors (TFTs) based on 5 and 7 nm thickness SnON channel layer is reported. The SnON TFT device with 7.6% nitrogen content achieves a record high µFE of 299 cm2 V−1 s−1 at 7 nm thickness and 277 cm2 V−1 s−1 at 5 nm thickness, compared to SnO2 with µFE of 211 cm2 V−1 s−1. At the same 5 nm quasi‐2D channel thickness, this µFE of nanocrystalline SnON transistor is comparable to single crystalline Si and InGaAs metal oxide semiconductor field‐effect transistor (MOSFET) and also higher than the phonon‐scattering‐limited 2D MoS2 FET. From the principle of quantum‐mechanical calculation, the high µFE of nanosheet SnON TFT is due to lower effective mass of electrons, 0.29 m0 in the conduction band in contrast to 0.41 m0 of SnO2. SnON can reduce the defect trap densities by introducing non‐oxide anions where the valence band can be controlled to remove or passivate the oxygen vacancy levels by substitutional alloying with nitrogen anions to circumvent instability, increase on‐current (ION) and improve the µFE. It is highly expected that the high performance quasi‐2D nanosheet SnON TFTs will be utilized in embedded DRAM and monolithic 3D integrated circuits (ICs).