Objective To evaluate the clinical efficacy of artificial femoral head replacement in elderly patients with femoral neck fractures. Methods A total of 50 elderly patients with femoral neck fractures admitted to the Second People's Hospital of Dongying City from May 2021 to May 2024 were enrolled as study participants. These patients were randomly divided into two groups using a lottery method, with 25 cases in each group. The control group underwent total hip arthroplasty, while the test group received artificial femoral head replacement. Operative indicators, early complication outcomes, and hip function were assessed in both groups. Results In terms of dimensions such as complication outcomes, the comparison between the two sets of data shows no statistically significant difference (P>0.05). However, the test group exhibited less blood loss, lower costs, and shorter operation times compared to the control group (P<0.05). Hip function scores were evaluated after a 3-month follow-up, revealing higher scores in the test group than in the control group (P<0.05). Conclusions Artificial femoral head replacement demonstrates favorable clinical outcomes for elderly patients with femoral neck fractures. This surgical approach reduces treatment costs, improves economic feasibility, and enhances hip function. For unstable elderly patients with femoral neck fractures, poor general conditions, and multiple complications, this procedure can improve prognosis and therapeutic efficacy.