The origin of charge density wave (CDW) observed in low‐dimensional systems is, for long, a subject of intensive debate in contemporary condensed matter physics. Specifically, a simple and well established model, namely, the Peierls instability is often (but not always) used to clearly explain CDW states in real systems. Here, first‐principles density functional theory calculations are used to show CDW formation at a one‐dimensional interface embedded in a lateral heterostructure comprising blue and black phosphorene, even at room temperature. The CDW formation is fully explained by the Peierls mechanism, including a double‐periodicity lattice distortion energy lowering and a bandgap opening. The lattice distortion also substantially modifies the band alignment of the heterostructure. Comparison with a freestanding P chain shows that the structural distortion is confined to one dimension within the heterostructures, ruling out competing non‐Peierls‐type distortions in two dimensions. In addition, similar Peierls‐type distortions for other lateral heterostructures are shown by using the example of a graphene–hexagonal boron nitride heterostructure, which may stimulate related studies in different 2D systems. These findings not only shed more light on the Peierls mechanism, but also have important implications for devices based on 2D lateral heterostructures.