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Dipolarization fronts (DFs), characterized by sharp increases in the northward magnetic field and usually preceded by magnetic dips, are suggested to play an important role in energy conversion and transport in the magnetotail. It has been documented that strong energy conversion typically develops right at the fronts. Here we present spacecraft observations of electron‐scale energy conversion (EEC) developed inside the dip region ahead of a DF, by using high‐cadence data from the Magnetospheric Multiscale Mission. The EEC, with magnitude comparable to that at the front, is primarily driven by ion current and electron‐scale electric field. The electric field inside the dip is provided by electrostatic waves fed by lower hybrid drift instability, which experiences temporal decaying. Such decaying leads to nonhomogeneity of EEC along the dawn‐dusk direction. These results, uncovering a new channel for DF‐driven energy conversion, can provide important insights into understanding energy transport in the magnetotail. Plain Language Summary: Space weather is determined by earthward transport of energy and mass in the magnetosphere. In the magnetotail, such transport is usually associated with dipolarization fronts embedded inside high‐speed plasma jets, which are characterized by a sharp enhancement of the northward component of the magnetic field and serve as the leading boundaries of plasma jets. Statistical studies reveal that a small decrease in the magnetic field often occurs ahead of the fronts, which is dubbed as a magnetic dip. Dipolarization fronts have been suggested to play a key role in the energy conversion chain in the magnetotail, and the energy conversion typically happens right in the front region where strong currents and electric fields usually develop. In this research, we find that in addition to the front region, the dip preceding the fronts can also host strong energy conversion. Our results help further understand energy conversion in the terrestrial magnetotail. Key Points: Electron‐scale energy conversion (EEC) is observed for the first time in the magnetic dip ahead of a dipolarization frontThe EEC, with magnitude comparable to that at the front, is primarily driven by ion current and electron‐scale motional electric fieldThe EEC electric field is induced by a decaying lower hybrid drift instability which may cause temporal damping of the EEC [ABSTRACT FROM AUTHOR]