Using the segmented contact method we separate and numerically evaluate the components making up the threshold current density dependence of quantum dot ridge waveguide lasers. An increasing internal optical mode loss and an increasing lateral out-diffusion current are the significant processes in ridges of widths between 4 and 10 μm, with no significant contribution from a deteriorating gain-mode overlap. By fitting a diffusion length model to the lateral out-diffusion process, we extract the ambipolar diffusion length, Ld, as a function of intrinsic carrier injection-level which covers carrier densities appropriate for functioning light-emitting diode and laser devices. The measured dependence fits a diffusion mechanism involving the thermal redistribution of carriers via the wetting-layer and most significantly leads to two regimes where Ld can be reduced in self-assembled quantum-dot systems. Only one of these is shown to be beneficial to the overall efficiency of the device, while the other is at the expense of undesired high-order nonradiative recombination processes at high injection-levels. Covering a peak modal gain range of approximately 5 to 11 cm−1 over injection-levels of 65 to 122 meV at 350 K, this dependence caused Ld to change from 0.75 to 1.50 μm, with the maximum occurring at 84 meV where the peak modal gain is 6 cm−1. Decreasing the temperature to 300 K reduced Ld to <0.75 μm over approximately the same injection-level range.