Low-temperature epitaxial growth of AlN ultrathin films was realized by atomic layer deposition (ALD) together with the layer-by-layer, in-situ atomic layer annealing (ALA), instead of a high growth temperature which is needed in conventional epitaxial growth techniques. By applying the ALA with the Ar plasma treatment in each ALD cycle, the AlN thin film was converted dramatically from the amorphous phase to a single-crystalline epitaxial layer, at a low deposition temperature of 300 °C. The energy transferred from plasma not only provides the crystallization energy but also enhances the migration of adatoms and the removal of ligands, which significantly improve the crystallinity of the epitaxial layer. The X-ray diffraction reveals that the full width at half-maximum of the AlN (0002) rocking curve is only 144 arcsec in the AlN ultrathin epilayer with a thickness of only a few tens of nm. The high-resolution transmission electron microscopy also indicates the high-quality single-crystal hexagonal phase of the AlN epitaxial layer on the sapphire substrate. The result opens a window for further extension of the ALD applications from amorphous thin films to the high-quality low-temperature atomic layer epitaxy, which can be exploited in a variety of fields and applications in the near future.