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Laser‐driven projection display puts forward urgent demand for color converter materials to simultaneously achieve balanced‐spectrum properties and strong heat dissipation. Herein, this work develops a novel optofunctional composite by coupling Y3Al5O12:Ce3+ transparent ceramics (TC) with CaAlSiN3:Eu2+ phosphor‐in‐glass film (PiGF) for the first time. Remarkably, this new material architecture design enables a balance between the spectrum properties and heat dissipation ability, and can yield high‐quality white light with brightness of over 2500 lm, luminous efficacy (LE) of over 200 lm W−1, correlated color temperature (CCT) of 3700–4100 K, and improved color rendering index (CRI) of 60–70. Furthermore, the PiGF@TC‐converted laser projection system is also successfully designed, showing natural and real color restoration. Additionally, the combined action of thermal quenching and optical excitation intensity quenching is confirmed for the luminescence saturation upon high‐power blue laser driven. The main mechanism of optical quenching is identified to be energy upconversion dominated by second‐order nonlinear processes. The findings described here suggest a step toward developing the admirable laser‐driven color converters for next‐generation lighting sources. [ABSTRACT FROM AUTHOR]