Photon recycling and carrier diffusion are the two plausible processes that primarily affect the carrier dynamics in halide perovskites, and therefore the evaluation of the performance of their photovoltaic and photonic devices. However, it is still challenging to isolate their individual contributions because both processes result in a similar emission redshift. Herein, it is confirmed that photon recycling is the dominant effect responsible for the observed redshifted emission. By applying one‐ and two‐photon confocal emission microscopy on Ruddlesden–Popper type 2D perovskites, of which interplane carrier diffusion is strictly suppressed, the substantial PL redshift (72 meV) is well reproduced by the photon transport model. A comparison of 3D bulk CH3NH3PbBr3 single crystal to 2D perovskite by depth‐resolved two‐photon PL spectra reveals the contribution of carrier diffusion on energy transport at a distance beyond diffusion length is constantly negligible, though the carrier diffusion indeed exists in the 3D crystal. The investigation resolves the fundamental confusion and debate surrounding the issue and provides significant insights into carrier kinetics in perovskites, which is important for future developments in solar cells and other optoelectronic devices.