We present observations in Earth’s magnetotail by the Magnetospheric Multiscale spacecraft that are consistent with magnetic field annihilation, rather than magnetic topology change, causing fast magnetic-to-electron energy conversion in an elongated electron-scale current sheet. This energy conversion process is in contrast to that in the standard electron diffusion region (EDR) of a reconnecting current sheet where the energy of antiparallel magnetic fields is mostly converted to electron bulk-flow energy. Fully kinetic simulation also demonstrates that an elongated EDR is subject to the formation of electron-scale magnetic islands in which fast energy conversion is dominated by the annihilation. Consistent with the observations and simulation, theoretical analysis shows that fast magnetic diffusion can occur in an elongated EDR in the presence of nongyrotropic electron effects. The discovery of the annihilation-dominated EDR reveals a new form of energy conversion in the collisionless reconnection process.