Typical die shift is beyond several tens micrometers or more, which is a serious problem on advanced fan-out wafer-level packaging (FOWLP), to give inevitable misalignment errors in the subsequent photolithography processes for fine-pitch redistributed wiring layer (RDL) formation. In particular, this problem is expected to grow all the more serious in chiplets and tiny dies less than 1 mm in a side. In this work, the use of an anchoring layer is proposed to fix these dies/chiplets on a double-side laminate thermo release tape and drastically reduce the die shift. In addition, an on-nail photoplethysmogram (PPG) sensor system as a flexible hybrid electronics (FHE) is integrated with μLED (270 μm by 270 μm) based on a die-first FOWLP methodology using a biocompatible polydimethylsiloxane (PDMS) mold resin for real-time monitoring pulse wave and percutaneous oxygen saturation (SpO2). The repeated bendability of fan-out Au wirings formed on the PDMS and the current-voltage (I-V) behavior of the μLED before and after die embedment in the PDMS is characterized.