Amid urgent global climate and biodiversity crises, the strategic restoration of degraded forests stands as a vital countermeasure. This study pioneers a novel approach for the identification and prioritization of potential degraded forest areas suitable for restoration (PDFR), utilizing the advancements in Earth observation data. Utilizing Landsat data within the Google Earth Engine, our PDFR method applies a nuanced, phenology-based threshold classification to accurately map forest covers at a 30-m resolution, distinguishing prime restoration areas such as evergreen, semi-evergreen, deciduous, and flooded forests, and categorizing them into varying levels of degradation using Siem Reap, a province in Cambodia as a case study. The projections indicate a promising potential for carbon sequestration through restoration of the critically (~96,693 ha), highly (48,878 ha), moderately (46,487 ha), and slightly degraded (75,567 ha) forests, estimating a capture of 193.73 TgCO2 in Siem Reap from 2021 to 2030 upon comprehensive restoration initiatives. As Earth observation technologies continue to evolve, the PDFR method emerges as a strategic blueprint for data-driven policy formulation, fostering sustainable forest management and aligning with the global commitments delineated in the Glasgow Forests Declaration for 2030.