The present disclosure relates to a fiber encapsulation mechanism for energy dissipation in a fiber amplifying system. One example embodiment includes an optical fiber amplifier. The optical fiber amplifier includes an optical fiber that includes a gain medium, as well as a polymer layer that at least partially surrounds the optical fiber. The polymer layer is optically transparent. In addition, the optical fiber amplifier includes a pump source. Optical pumping by the pump source amplifies optical signals in the optical fiber and generates excess heat and excess photons. The optical fiber amplifier additionally includes a heatsink layer disposed adjacent to the polymer layer. The heatsink layer conducts the excess heat away from the optical fiber. Further, the optical fiber amplifier includes an optically transparent layer disposed adjacent to the polymer layer. The optically transparent layer transmits the excess photons away from the optical fiber.