Edge states of two-dimensional transition-metal dichalcogenides (TMDCs) are crucial to quantum circuits and optoelectronics. However, their dynamics are pivotal but remain unclear due to the edge states being obscured by their bulk counterparts. Herein, we study the state-resolved transient absorption spectra of ball-milling-produced MoS2 nanosheets with 10 nm lateral size with highly exposed free edges. Electron energy loss spectroscopy and first-principles calculations confirm that the edge states are located in the range from 1.23 to 1.78 eV. Upon above bandgap excitations, excitons populate and diffuse toward the boundary, where the potential gradient blocks excitons and the edge states are formed through interband transitions within 400 fs. With below bandgap excitations, edge states are slowed down to 1.1 ps due to the weakened valence orbital coupling. These results shed light on the fundamental exciton dissociation processes on the boundary of functionalized TMDCs, enabling the ground work for applications in optoelectronics and light-harvesting.