Thin films of silica containing silver nanoparticles were deposited by magnetron co-sputtering followed by thermal annealing in air or Ar+2% H2. Laser fragmentation of the particles was carried out at two different wavelengths. The films were characterized by UV-VIS absorption spectroscopy and plasmon resonance numerical modeling based on the Mie theory, together with Rutherford backscattering elemental analysis, X-ray photoelectron spectroscopy chemical characterization, combined with statistical analysis of the transmission electron microscopy micrographs, and surface topography study by atomic force microscopy. It is demonstrated that the fragmentation is a result of a thermal process and its mechanism does not depend on the laser wavelength as long as the laser light is absorbed by the silver particles. Laser treatment with moderate fluences does not alter the precipitated metal content while fragmenting the particles. TEM study indicates that laser assisted silver particle modification can serve as a method for narrowing the particle size distribution.