Ultrafast fiber lasers, due to their short pulse duration, excellent beam quality, and high brightness, are extensively used in precision processing, biomedicine, nonlinear optics, and spectroscopy. However, great challenges still exist in improving the optical conversion efficiency in glass‐based gain media because of the high non‐radiative transition probability. Here, we demonstrate an oxyfluoride glass–ceramic (GC) fiber containing NaYF4:Yb3+ nanocrystal that enables enhanced 1064‐nm continuous‐wave laser output with an optical signal‐to‐noise ratio of 60 dB. Compared with the as‐prepared glass fiber, the optical conversion efficiency of GC fiber is improved from 24.2% to 30.0%. The improvement of laser action is mainly caused by the preferential incorporation of Yb3+ into the NaYF4 nanocrystal with low phonon energy. Using this well‐developed GC fiber, we successfully built a passively mode‐locked pulsed fiber laser that deliveries laser pulses with a pulse duration of 8.1 ps and a repetition frequency of 56.92 MHz. These results highlight that the GC strategy may provide a roadmap for the development of ultrafast fiber laser and the application of GC fibers in various optoelectronic fields.