Land conversion due to deforestation and urbanization tends to change oasis ecosystem service in arid and semiarid regions. In this context, this paper examines the impacts of land use/land cover change (LULC) on the degradation of ecosystem service values (ESVs) in AlUla cultural oasis, northwestern Saudi Arabia, using Landsat images of the years 1984, 1992, 2010, and 2023, cross-validated with field surveys and high-resolution data. Different approaches were used for the purpose of this study, including support vector machine (SVM), hot-spot analysis, and cluster and outlier analysis (local Moran's I). However, to compute and evaluate the ESV, we used the benefit transfer approach (BTM). The results indicated a significant change in the built-up area between 1984 and 2023, which increased by 12.53 km2. This transformation led to a wide variation in all ESVs each year, with an increase of ESV by USD 44.78 million during 1984 to 1992. In the following decade, however, the AlUla oasis witnessed a loss in its ESV by approximately USD 0.73 million and USD 36.70 million during the periods 1992 to 2010 and 2010 and 2023, respectively. Moreover, the spatial distribution patterns of ESVs varied considerably, especially for provisioning service (PS) and supporting service (SS), while it was more clustering for regulating service (RS) and cultural service (CS). This study indicates that urban development is among the important factors behind changes and losses in the ESV in this arid oasis.