The study explores the potential of next-generation satellite hyperspectral imaging systems for screening and predicting surface‐soil contamination and degradation by exploiting various spectral indices and signature‐matching techniques at a heavily industrialized area in India. The soil moisture content, desertification and salinity status, clay or fine material content, heavy metal content, vegetation health status, and stress levels were assessed from continuum-removed spectral reflectance values. Results indicated the presence of water in two tailings ponds, high salinity, and desertification values in most of the tailings ponds and dump sites, clay boundary liner along four ponds, high heavy metal indices along three ponds and all dump sites, highly stressed vegetation near all tailings ponds and coal dump sites, and pollutants in nearby water channels. The results suggest a strategy for the initial identification of priority areas for ground-based investigations and an alternative rapid methodology to monitor large industrial hubs in India.