The present study focuses on novel degradation products of nelarabine generated from forced degradation study. In the process, a novel analytical method was developed which was not only compatible with liquid chromatography‐mass spectrometry but also had the efficiency to capture each of the possible degradation products with sufficient separation from the nelarabine peak. Nelarabine was exposed to acidic, alkali, oxidation, photolytic, and thermal stress conditions as recommended by International Conference on Harmonization guidelines. No major degradation was observed under photolytic and thermal conditions however the drug was observed to be significantly degraded under acidic, alkali, and oxidative stress conditions generating a total of nine novel degradation products which are hitherto not been reported in the literature. The major degradation products obtained under acidic and alkali conditions were isolated using preparative high‐performance liquid chromatography and their structure was elucidated using nuclear magnetic resonance spectroscopy and high‐resolution mass spectroscopic studies. Moreover, probable pathways for the formation of these degradation products were also outlined.