Aluminum hydroxide (ATH) is an environmentally friendly flame retardant widely employed in polymers. However, the high loading of ATH, due to its limited efficiency, potentially compromises other properties, including mechanical properties. This work explores a feasible ball milling strategy for high-efficiency ATH-based flame retardants (PPA-ATH and PPOA-ATH), fabricated by employing phenylphosphinic acid (PPA) and phenylphosphonic acid (PPOA) as surface modifiers and water as the processing solvent. The characterization study of PPA-ATH and PPOA-ATH demonstrates that ball milling effectively reduces their particle size, enhances their specific surface area, and improves their dispersibility within the ethylene-vinyl acetate (EVA) matrix. PPOA-ATH exhibited superior capabilities in enhancing the thermal stability and flame retardancy of EVA composites compared to PPA-ATH. The incorporation of PPOA-ATH resulted in the retarding in the temperature at 50% mass loss by 21 °C and an increase in the char residue of 34.5% at 700 °C. Furthermore, PPOA incorporation led to reductions of 81.0% in the peak heat release rate, 48.1% in the total heat release, 73.7% in the peak smoke production rate, and 41.2% in the total smoke production compared to neat EVA. This green modification strategy successfully addresses the application limitations of ATH, providing a feasible and environmentally friendly method for high-efficiency ATH-based flame retardant fabrication.