Water quality degradation and metal contamination in groundwater are serious concerns in an arid region with scanty water resources. This study aimed at evaluating the source of uranium (U) and potential health risk assessment in groundwater of the arid region of western Rajasthan and northern Gujarat. The probable source of vanadium (V) and fluorine (F) was also identified. U and trace metal concentration, along with physicochemical characteristics were determined for 265 groundwater samples collected from groundwater of duricrusts and palaeochannels of western Rajasthan and northern Gujarat. The U concentration ranged between 0.6 and 260 μg L−1 with a mean value of 24 μg L−1, and 30% of samples surpassed the World Health Organization’s limit for U (30 μg L−1). Speciation results suggested that dissolution of primary U mineral, carnotite [K2(UO2)2(VO4)2·3H2O] governs the enrichment. Water–rock interaction and evaporation are found the major hydrogeochemical processes controlling U mineralization. Groundwater zones having high U concentrations are characterized by Na–Cl hydrogeochemical facies and high total dissolved solids. It is inferred from geochemical modelling and principal component analysis that silicate weathering, bicarbonate complexation, carnotite dissolution, and ion exchange are principal factors controlling major solute ion chemistry. The annual ingestion doses of U for all the age groups are found to be safe and below the permissible limit in all samples. The health risk assessment with trace elements manifested high carcinogenic risks for children.