The microstructure of hypereutectic immiscible Cu-50Cr alloy (wt%) was effectively refined and homogenized by a high power density Nd:YAG continuous laser beam (power density 10⁴–10⁵ MW/m²). The average grain size of Cr was effectively refined from ~100 μm to ~1 μm, and some of the Cr particles even decreased to a few hundred nanometers. The high cooling rate (7.29 × 10⁶ K/s) effectively inhibited the coarsening effect on Cr particles during liquid phase separation (LPS). The spherical Cr particles were preferably dispersed in the melt layer, and the thickness of the layer was up to ~150 μm. The refinement and dispersion of the Cr phase contributed to improving the interruption capability of the Cu-Cr contacts. Compared with the untreated samples, the arc duration and the withstanding voltage of the laser surface melting (LSM) treated contacts with refined microstructure increased to 21% and 33%, respectively. The results demonstrated that the LSM method was an effective approach to optimize the microstructure of Cu-Cr alloy, which made it a promising modification method for Cu-Cr vacuum contact applications.