Desertification poses a perpetual threat to the security of desert ecosystems. Perennial desert vegetation plays a crucial role in maintaining the structure and function of a desert ecosystem and slowing down its desertification process by creating “fertile islands” beneath their canopy. Yet, how these fertile islands affect the transformation of soil phosphorus (P) fractions and the relationship between soil P fractions and enzymatic activities or microbial biomass beneath differing plant species and across soil depths still remains uncertain. Here we collected and analyzed soil P fractions (Hedley P pools), enzymatic activities (alkaline phosphatase [ALP] and β-glucosidase), microbial biomass carbon (MBC), nitrogen (MBN), and phosphorus, in addition to other soil properties, beneath three typical perennial species (Alhagi sparsifolia, Karelinia caspia, Tamarix ramosissima) and in interspace area soils over a 0–100 cm soil profile, under the desert-oasis transition zone of hyper-arid and soil P-impoverished. We found that soil P fractions, especially soil labile-P, soil enzymatic activities, soil water content (SWC), NH₄⁺-N and NO₃⁻-N concentration were closely related to the soils beneath canopy than interspace area. Soil depth and plant species also significantly affected soil labile-P and other soil properties, with the highest being topsoil beneath the canopy. Soil labile-P increased substantially beneath the canopy and was positively related to the activities of ALP and β-glucosidase and the concentrations of soil MBC and MBN, while negatively related to SWC and electrical conductivity. We also observed that the fertile island effect was generally consistent with canopy size and ranked as follows: T. ramosissima > K. caspia > A. sparsifolia. This comprehensive field study advances our current understanding of the transformation of soil P fractions vis-à-vis the fertile island effect in desert ecosystems, which could be useful for mitigating desertification by improving soil protection and greening the desert landscape.