Analyzing satellite images and remote sensing (RS) data using artificial intelligence (AI) tools and data fusion strategies has recently opened new perspectives for environmental monitoring and assessment. This is mainly due to the advancement of machine learning (ML) and data mining approaches, which facilitate extracting meaningful information at a large scale from geo-referenced and heterogeneous sources. This paper presents the first review of AI-based methodologies and data fusion strategies used for environmental monitoring, to the best of the authors’ knowledge. The first part of the article discusses the main challenges of geographical image analysis. Thereafter, a well-designed taxonomy is introduced to overview the existing frameworks, which have been focused on: (i) detecting different environmental impacts, e.g. land cover land use (LULC) change, gully erosion susceptibility (GES), waterlogging susceptibility (WLS), and land salinity and infertility (LSI); (ii) analyzing AI models deployed for extracting the pertinent features from RS images in addition to data fusion techniques used for combining images and/or features from heterogeneous sources; (iii) describing existing publicly-shared and open-access datasets; (iv) highlighting most frequent evaluation metrics; and (v) describing the most significant applications of ML and data fusion for RS image analysis. This is followed by an overview of existing works and discussions highlighting some of the challenges, limitations and shortcomings. To provide the reader with insight into real-world applications, two case studies illustrate the use of AI for classifying LULC changes and monitoring the environmental impacts due to dams’ construction, where classification accuracies of 98.57% and 97.05% have been reached, respectively. Lastly, recommendations and future directions are drawn.