Micro‐sized lotus fibers (MLFs) are derived from Vietnamese lotus plant stems, making them eco‐friendly. The composition of MLFs includes wax, oil, lignin, hemicellulose, and cellulose. The purpose of sodium hydroxide treatment is to remove unwanted components in MLFs like wax, oil, lignin, etc., to clean and roughen the surface, increase thermal stability, and enhance adhesion between MLFs with epoxy resin to improve the fracture toughness of the composite. The study investigated the impact of sodium hydroxide concentration, temperature, and treatment duration on the fracture toughness of epoxy resin reinforced with MLFs. Results indicated that treating lotus fiber with sodium hydroxide enhanced the biocomposite's fracture toughness, as indicated by the critical‐stress‐intensity factor (KIC) and Izod impact strength. Optimal treatment conditions of 80 °C at 6% NaOH for 6 h led to a 91% increase in the critical‐stress‐intensity factor (from 2.0 to 3.82 MPa m1/2) and a 121% rise in Izod impact strength (from 4.32 to 9.56 kJ/m2). Thermal properties (TGA) and structural morphology (SEM) of micro‐sized lotus fibers pre‐ and post‐sodium hydroxide treatment were evaluated using thermogravimetric analysis and scanning electron microscopy images.