Laser damage-prone precursors in high index materials such as hafnia are believed to be the primary limiter in the performance of dielectric multilayer films to advance ultra-high power and energy laser applications. Removing or suppressing these precursors is the key to fabricating laser damage resistant thin films for the enabling technologies. Early work has revealed that nanobubbles formed by entrapped argon (Ar) working gas in ion beam sputtering (IBS) produced hafnia films are primarily responsible for the onset of laser damage upon exposure to UV, ns-laser pulses. In this study, we demonstrate that the UV ns-laser damage onset of IBS produced hafnia films can be improved to 3.1 +/- 0.2 J/cm² by substituting the conventional Ar working gas with xenon (Xe), a nearly 1 J/cm² increase from that of the Ar produced hafnia films. In addition to the suppression of the overall point-defect density of the hafnia films, the reduction of the Xe entrapment eliminates the nanobubbles and the generation of plasmas that initiates the laser damage. The defect suppression and its correlation to the increase in laser damage threshold is revealed by the combined analysis of Rutherford backscattering spectroscopy, electron paramagnetic resonance spectroscopy, transmission electron microscopy, and laser damage testing. Monte Carlo simulations suggest a much smaller entrapment of Xe gas by comparison to Ar, which is attributed to the significant difference in the energy of the reflected neutrals (3X) which are likely to be implanted. These results provide an effective process route with a fundamental understanding for producing high laser damage resistant dielectric films for high power and high energy laser applications.