Underground coal mining in western China causes heavy land subsidence and alters the soil ecology. However, the effects of land subsidence on soil fertility are not currently known, and the key factors governing its impact remain unclear in sandy land. We investigated the effects of land subsidence induced by underground mining on the soil quality in western China. Soil samples were collected at 0–15 cm and 15–30 cm from control and subsidence areas in three coal mines. The results showed that the soil water content (SWC), clay and silt percentage, total nitrogen (TN), dissolved organic carbon (DOC), ammonia nitrogen (NH4+-N), nitrate nitrogen (NO3--N), available phosphorus (AP), and available potassium (AK) of the subsidence areas were significantly lower than those of the control areas. The saccharase, urease, and alkaline phosphatase activities in the subsidence areas decreased compared to those in the control areas, while the sand percentage of soil tended to increase. Soil nutrient contents, bacterial quantities, and activities of soil enzymes were positively correlated with SWC. Redundancy analysis (RDA) showed that the soil particle size distribution, SWC, and electrical conductivity (EC) were the major environmental factors driving changes in soil properties. These results indicated that land subsidence induced by coal mining caused losses in surface soil water and nutrients, and ultimately led to soil quality degradation. Therefore, the reclamation of mining subsidence land might be necessary, especially in arid and semi-arid areas.