Molybdenum disulfide (MoS2), a metal dichalcogenide, is a promising channel material for highly integrated scalable transistors. However, intrinsic donor defect states, such as sulfur vacancies (Vs), can degrade the channel properties and lead to undesired n‐doping. A method for healing the donor defect states in monolayer MoS2 is proposed using oxygen plasma, with an aluminum oxide (Al2O3) barrier layer that protects the MoS2 channel from damage by plasma treatment. Successful healing of donor defect states in MoS2 by oxygen atoms, even in the presence of an Al2O3 barrier layer, is confirmed by X‐ray photoelectron spectroscopy, photoluminescence, and Raman spectroscopy. Despite the decrease in 2D sheet carrier concentration (Δn2D = −3.82×1012 cm−2), the proposed approach increases the on‐current and mobility by 18% and 44% under optimal conditions, respectively. Metal–insulator transition occurs at electron concentrations of 5.7×1012 cm−2 and reflects improved channel quality. Finally, the activation energy (Ea) reduces at all the gate voltages (VG) owing to a decrease in Vs, which act as a localized state after the oxygen plasma treatment. This study demonstrates the feasibility of plasma‐assisted healing of defects in 2D materials and electrical property enhancement and paves the way for the development of next‐generation electronic devices.