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Abstract Top‐down entrainment shapes the vertical gradients of sensible heat, latent heat, and CO₂fluxes, influencing the interpretation of eddy covariance (EC) measurements in the unstable atmospheric surface layer (ASL). Using large eddy simulations for convective boundary layer flows, we demonstrate that decreased temperature gradients across the entrainment zone increase entrainment fluxes by enhancing the entrainment velocity, amplifying the asymmetry between top‐down and bottom‐up flux contributions. These changes alter scalar flux profiles, causing flux divergence or convergence and leading to the breakdown of the constant flux layer assumption (CFLA) in the ASL. As a result, EC‐measured fluxes either underestimate or overestimate “true” surface fluxes during divergence or convergence phases, contributing to energy balance non‐closure. The varying degrees of the CFLA breakdown are a fundamental cause for the non‐closure issue. These findings highlight the underappreciated role of entrainment in interpreting EC fluxes, addressing non‐closure, and understanding site‐to‐site variability in flux measurements.