Shallow borehole drilling has been conducted at the Sarni area of Betul Belt, Central India to understand the subsurface geology and nature of mineralization. The predominant lithounits are ferruginous quartzites, felsic volcanic rocks, and with minor intrusions of amphibolites. The encountered felsic volcanic rocks are rhyolites varying from pink (rich in K‐feldspar) to grey (rich in Na‐feldspar and amphiboles). The rhyolitic rocks have undergone intense hydrothermal alteration. The alteration zones are defined by the presence of biotite‐chlorite‐garnet‐gahnite; biotite‐sericite‐chlorite‐anthophyllite and anthophyllite‐actinolite‐tremolite‐carbonate mineral assemblages. Sulphide pits, highly leached zones with occasional bluish tinges, limonitic patches are present in the felsic volcanic rocks, followed by semi‐massive to disseminated sulphide mineralization indicative of Kuroku‐ type Zn–Cu–Pb volcanic‐hosted Massive Sulphide (VHMS) mineralization. Scanning electron microscope and energy‐dispersive x‐ray spectroscopy studies documented sphalerite, pyrite, chalcophyrite, arsenopyrite, pyrrhotite, and minor Au–Ag phases. The Sarni rhyolites exhibit chalcopyrite disease in sphalerite, replacement, and overgrowth ore‐textures. The high HFSE, low Zr/Y ratio, pronounced negative Eu anomalies characterize the felsic volcanic rocks as FIIIb type with high zircon saturation temperatures of 856–931°C. These rhyolites are formed at a back‐arc rift setting in an ensialic island‐arc tectonic regime. The synvolcanic structures facilitated the magma ascent to the surface. The hydrothermal circulation due to adequate heat flow in the back‐arc rift environment, in an episodic multicyclic process provided sufficient time for accumulation of sulphides from the seafloor, which was later deposited to form a VHMS mineralization. We also report tungsten (W) mineralization in the quartz veins of these felsic volcanic rocks. It is suggested that the felsic magma has interacted with metasedimentary sequences and assimilated W‐ore bearing fluids, and during remobilization in the later stages of tectonic activity enabled the deposition of tungsten in these quartz veins.