Gold mining is a tremendously important economic activity in rural districts of Ethiopia. We assessed the impacts of artisanal gold mining on soil and woody vegetation in northern Ethiopia. Estimation of soil loss, plant inventory, group discussions and transect studies were used to address the research questions. We employed t‐test to compare woody species and soil loss between mined and unmined sites. Moreover, we ran one‐way ANOVA to compare the average volume of soil loss among the mining sites. The study shows that gold mining removed colossal volumes of soil from the mining landscape with a significant difference among gold mining sites (P ≤ 0.05). Soil loss between the mined and unmined sites was also significant (P ≤ 0.05). Moreover, gold mining destroyed massive tracts of vegetation. Woody species encountered at plot level decreased from artisanal gold mined to unmined sites (P ≤ 0.05). Moreover, dead trees and exposed tree roots were higher in mined than the unmined areas (P ≤ 0.05). This discouraged regeneration and recruitment of woody vegetation. To conclude, gold mining system converted vegetated sites and farmlands into dysfunctional landscape. Therefore, we suggest that combined rehabilitation efforts are required to overcome the challenges of artisanal gold mining on sustainable land management in northern Ethiopia.