Straw return is the simplest and the most economic method to improve soil structure. Slow decomposition rate limits straw return in sandy fields, which has becoming one of the obstacles in sandy land reclamation. Ammonification of straw before return accelerates straw decomposition, but it requires the use of extra N fertilizer, however, little is known about N fertilizer management in fields with ammoniated straw incorporation. So, a 3‐year field experiment was conducted with different proportions of N fertilizer aimed to maize straw ammonification and field broadcasting, and evaluated straw decomposition proportion, straw N release, soil organic carbon content, soil aggregates, soil water and N availability, and grain yield. Total N application rate was 300 kg per hectare, with five N input amounts for straw per hectare ammonification: 0 (SN0), 40 (SN40), 80 (SN80), 120 (SN120), and 160 (SN160) kg, and the rest of N broadcasted in soil during maize growing season. Ammonification accelerated straw decomposition and N release, and these effects showed no significant difference between SN80, SN120, and SN160. After straw decomposition for 150 days, the decomposition proportion was 62.1%, 53.0%, and 39.2% in SN80, SN40, and SN0, respectively. After 3 years of straw return, SN80 exhibited a significantly higher mean weight diameter of soil aggregates (35.6% higher), organic carbon content (18.4% higher), water‐holding capacity (17.4% higher), and soil water storage (17.2% higher) than SN0. Additionally, SN80 and SN120 showed the most significant effect on “N slow‐release” in soil. The above effects resulted with more available soil water and N used for crop growth, and increased grain yields (18.1% higher) and water use efficiency (18.6% higher) in SN80, compared with SN0. Hence, we conclude that a proper N allocation between straw and soil can synergistically enhance soil structure and crop productivity in sandy farmlands. This founding would provide scientific and technological support for straw return in sandy fields and is beneficial to sustainable development of oasis.