We demonstrate the generation of dissipative soliton in an all-normal dispersion passively mode-locked ytterbium-doped fiber laser using few-layer molybdenum diselenide (MoSe2) as a saturable absorber. By adopting the cost-effective liquid phase exfoliation approach, few-layer MoSe2 nanosheets are exfoliated and mixed with polyvinyl alcohol (PVA) to prepare a free-standing MoSe2-PVA film. The developed film is attached between two fiber ferrules to make a fiber compatible saturable absorber device. By incorporating this saturable absorber in an all-normal dispersion laser cavity, a stable dissipative soliton with a pulse width of 471 ps and 3-dB bandwidth of 4.26 nm centered at 1040 nm is generated. The fundamental repetition rate and the average power are measured as 15.44 MHz and 2 mW, respectively. To the best of our knowledge, this is the first demonstration of a dissipative soliton generation in 1 μm wavelength region using few-layer MoSe2 saturable absorber. These results exhibit the significant potential of MoSe2-based saturable absorber in the near-IR region for all-fiber mode-locked lasers. © 2016 Society of Photo-Optical Instrumentation Engineers (SPIE).