Revealing the spatiotemporal evolution characteristics and key driving processes of habitat quality is of significant importance for the scientific management of production, life, and ecological space, as well as the efficient allocation of resources in resource-based cities. Taking Pan'an Lake Street, the largest coal-mining subsidence area in Jiangsu Province, China, as the study area, we measured the spatiotemporal evolution of land use development intensity, morphology, and function for four time periods (2007, 2012, 2017, and 2022). Utilizing the InVEST model, spatial autocorrelation, and hotspot analysis methods, we assessed the habitat quality characteristics in the Pan’an Lake area. Finally, employing the GTWR model, we quantified the impact intensity of influencing factors and revealed the spatial differentiation characteristics of the impact of each factor on habitat quality. The results indicate continuous increases in construction land, drastic type conversions, and frequent urban construction activities in the Pan’an Lake area, with significant human disturbances affecting the wetland park. Both the maximum and average values of the habitat degradation index show a noticeable rise, and the intensity of habitat degradation is increasing, accompanied by an expanding disparity in habitat degradation levels. The period of coal mining and large-scale urban development is associated with the lowest habitat quality. The main cause of the decline in habitat quality in the Pan’an Lake area is the increase in land use development intensity, while the roles and intensities of other factors exhibit spatial heterogeneity at different stages.