A novel enhancement algorithm for degraded image using dual-domain-adaptive wavelet and improved fuzzy transform is proposed, aiming at the problem of surveillance videos degradation caused by the complex lighting conditions underground coal mine. Firstly, the dual-domain filtering (DDF) is used to decompose the image into base image and detail image, and the contrast limited adaptive histogram enhancement (CLAHE) is adopted to adjust the overall brightness and contrast of the base image. Then, the discrete wavelet transform (DWT) is utilized to obtain the low frequency sub-band (LFS) and high frequency sub-band (HFS). Next, the wavelet shrinkage threshold is applied to calculate the wavelet threshold corresponding to the HFS at different scales. Meanwhile, a new Garrate threshold function that introduces adjustment factor and enhancement coefficient is designed to adaptively de-noise and enhance the HFS coefficients, and the Gamma function is employed to correct the LFS coefficients. Finally, the PAL fuzzy enhancement operator is improved and used to perform contrast enhancement and highlight area suppression on the reconstructed image to obtain an enhanced image. Experimental results show that the proposed algorithm can not only significantly improve the overall brightness and contrast of the degraded image but also suppresses the noise of dust and spray and enhances the image details. Compared with the similar algorithms of STFE, GTFE, CLAHE, SSR, MSR, DGR, and MSWT algorithms, the indicator values of comprehensive performance of the proposed algorithm are increased by 205%, 195%, 200%, 185%, 185%, 85%, 140%, and 215%, respectively. Moreover, compared with the other seven algorithms, the proposed algorithm has strong robustness and is more suitable for image enhancement in different mine environments.