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Symmetry is one of the most significant concepts in physics, and its importance has been largely manifested in phase transitions by its spontaneous breaking. In strongly correlated systems, however, mysterious and enigmatic phase transitions, inapplicable of the symmetry description, have been discovered and often dubbed hidden order transitions, as found in, $\it{e.g.}$, high-$T_C$ cuprates, heavy fermion superconductors, and quantum spin liquid candidates. Here, we report a new type of hidden order transition in a correlated heterostructure Sr$_2$VO$_3$FeAs, whose origin is attributed to an unusually enhanced Kondo-type proximity coupling between localized spins of V and itinerant electrons of FeAs. Most notably, a fully isotropic gap opening, identified by angle-resolved photoemission spectroscopy, occurs selectively in one of the Fermi surfaces below $T_{\rm HO}$ $\sim$ 150 K, associated with a singular behavior of the specific heat and a strong enhancement on the anisotropic magnetoresistance. These observations are incompatible with the prevalent broken-symmetry-driven scenarios of electronic gap opening and highlight a critical role of proximity coupling. Our findings demonstrate that correlated heterostructures offer a novel platform for design and engineering of exotic hidden order phases.