To evaluate urban human settlement, we propose a human settlement environment development index (HSEDI) model by choosing vegetation coverage, land surface temperature, impervious surfaces, slope, wetness, and water condition as the evaluation factors. We applied the proposed model to Xuzhou City, Jiangsu Province, China. Landsat-5 Thematic Mapper (TM) images from 1998 to 2010 and digital elevation model (DEM) data with a 30-m resolution were used to calculate the values of the six evaluation factors. The HSEDI value in Xuzhou City was found to be between 2.24 and 8.10 from 1998 to 2010, and it was further divided into five levels, uninhabitable, moderately uninhabitable, generally inhabitable, moderately inhabitable, and inhabitable. The best HSEDI value was in 2007. The generally inhabitable region was about 100.98 km2, covering 30.87% of the total area in 2007; the moderately inhabitable region was about 170.58 km2 covering 52.15% of the total area; the inhabitable region was about 32.03 km2, covering 9.79% of the total area; the percentage of the uninhabitable region was zero; and that of the moderately uninhabitable region was very small, less than 1.00%. Moreover, we analyzed the habitability in the respect of spatial patterns and change detection. Results show that the degraded regions of habitability quality are mainly located in the urban fringe and the improved regions are mainly located in the main urban and rural areas. Reason for the degraded habitability quality is the rapid progress of urbanization. However, the increase in urban green spaces and the construction of the main urban area promoted the improved habitability quality. Besides, we further analyzed socio-economic and socio-demographic data to confirm the results of the habitability analysis. The results indicate that the human settlement in Xuzhou City is in a satisfactory condition, but some efforts should be made to control the possible uninhabitable and moderately uninhabitable regions, and to improve the quality of the generally inhabitable regions.