Light localization by metal particles of nanometer size allows to not only control the propagation of light, but also enhance magneto‐optical effects. The influence of the immersion of gold nanodisks inside a transparent magnetic medium, namely, Bi‐substituted iron garnet, is investigated, and the optimal position of the nanoparticles within the magnetic material for a strong enhancement of the effect is unraveled. Three samples with periodic arrays of Au cylinders are studied: disks on the surface of the magnetic dielectric film, inside the magnetic film, and directly under the magnetic film. The largest enhancement of the Faraday effect mediated by a localized surface plasmon resonance takes place when nanodisks are submerged inside the magnetic film at a few nanometers below its upper surface. It is shown that the most prominent influence on the Faraday effect enhancement is provided by the magnetic medium between the nanodisks. The experimental results are in good agreement with the numerical analysis.