Low-loss surface channel waveguides with a cross-section of 30 × 30 μm2 are produced by diamond saw dicing of 6.2 at.% Tm3+, 3.5 at.% Gd3+:LiYF4 films grown by liquid phase epitaxy (LPE) on (001)-oriented bulk undoped LiYF4 substrates. Pumped by a Ti:Sapphire laser at 783 nm, a continuous-wave Tm:LiYF4 waveguide laser generated 1.30 W at 1880 nm (for π-polarization) with a slope efficiency of 80% with respect to the absorbed pump power. The laser threshold was at 80 mW. The waveguide morphology was studied revealing low roughness (3 ± 2 μm) as expressed by the propagation losses of <0.3 dB/cm. A combination of LPE and diamond saw dicing is a promising technology for multi-watt single-mode channel waveguide lasers and amplifiers.