A delicate balance between high electrical conductivity and ultra-low glass-like thermal conductivity is critical for enhancing thermoelectric performance. Here, by introducing grain boundary trapping states into the AgSbTe2 matrix, the thermally activated release of carriers at elevated temperatures enhances electrical conductivity, while the increased barrier potential induces an energy filtering effect that sustains a high Seebeck coefficient. This synergistic optimization of electrical conductivity and Seebeck coefficient significantly enhances the power factor. Additionally, numerous point defects and a higher density of grain boundaries further enhance phonon scattering, resulting in a 33% reduction in glass-like thermal conductivity compared to the pristine sample. With enhanced power factor and reduced lattice thermal conductivity, Fe-doped AgSbTe2 achieves a remarkable peak zT of 1.8 at 623 K and an impressive zTavg of 1.4 over the temperature range of 323–623 K, showcasing its leading performance in the field. By selecting proper contact layer materials with matched thermal expansion coefficients, low interfacial resistivity was achieved, enabling a single-leg thermoelectric device with ∼10% efficiency under a 323 K temperature difference.