The Danakil region of northern Afar is an area of ongoing seismic and volcanic activity caused by the final stages of continental breakup. To improve the quantification of seismicity, we developed a calibrated local earthquake magnitude scale. The accurate calculation of earthquake magnitudes allows the estimation of b‐values and maximum magnitudes, both of which are essential for seismic‐hazard analysis. Earthquake data collected between February 2011 and February 2013 on 11 three‐component broadband seismometers were analyzed. A total of 4275 earthquakes were recorded over hypocentral distances ranging from 0 to 400 km. A total of 32,904 zero‐to‐peak amplitude measurements (A) were measured on the seismometer’s horizontal components and were incorporated into a direct linear inversion that solved for all individual local earthquake magnitudes (ML), 22 station correction factors (C), and 2 distance‐dependent factors (n, K) in the equation ML=log(A)−log(A0)+C. The resultant distance correction term is given by −log(A0)=1.274336log(r/17)−0.000273(r−17)+2. This distance correction term suggests that attenuation in the upper and mid‐crust of northern Afar is relatively high, consistent with the presence of magmatic intrusions and partial melt. In contrast, attenuation in the lower crust and uppermost mantle is anomalously low, interpreted to be caused by a high melt fraction causing attenuation to occur outside the seismic frequency band. The calculated station corrections serve to reduce the ML residuals significantly but do not show a correlation with regional geology. The cumulative seismicity rate produces a b‐value of 0.9±0.06, which is higher than most regions of continental rifting yet lower than values recorded at midocean ridges, further supporting the hypothesis that northern Afar is transitioning to seafloor spreading.