The transmissive mode laser micro-ablation performance of near-infrared (NIR) dye-optimized ammonium dinitramide (ADN)-based liquid propellant was investigated in laser plasma propulsion using a pulse YAG laser with 5 ns pulse width and 1064 nm wavelength. Miniature fiber optic near-infrared spectrometer, differential scanning calorimeter (DSC) and high-speed camera were used to study laser energy deposition, thermal analysis of ADN-based liquid propellants and the flow field evolution process, respectively. Experimental results indicate that two important factors, laser energy deposition efficiency and heat release from energetic liquid propellants, obviously affect the ablation performance. The results showed that the best ablation effect of 0.4 mL ADN solution dissolved in 0.6 mL dye solution (40%-AAD) liquid propellant was obtained with the ADN liquid propellant content increasing in the combustion chamber. Furthermore, adding 2% ammonium perchlorate (AP) solid powder gave rise to variations in the ablation volume and energetic properties of propellants, which enhanced the propellant enthalpy variable and burn rate. Based on the AP optimized laser ablation, the optimal single-pulse impulse (I)~9.8 μN·s, specific impulse (Isp)~234.9 s, impulse coupling coefficient (Cm)~62.43 dyne/W and energy factor (η)~71.2% were obtained in 200 µm scale combustion chamber. This work would enable further improvements in the small volume and high integration of liquid propellant laser micro-thruster.