Rare earth elements (REEs) are essential for renewable energy and advanced technologies, making them a priority for critical mineral research in the U.S. Coal ash, a byproduct of coal combustion, can contain concentrated REEs and is being explored as a potential resource. This study tested the effectiveness of hyperspectral imaging in detecting neodymium, a light REE, in coal ash using a new hyperspectral imaging processing method, called Neodymium Index. We collected coal samples from New Mexico and ash samples from Texas, then tested how well neodymium could be seen in images at specific wavelengths. It was found that hyperspectral imaging can detect neodymium at concentrations as low as 1.5% by weight. However, high iron levels in the samples can make detection harder. Coarser ash particles showed better neodymium spectral signals. These results suggest hyperspectral imaging is a promising, fast method for identifying REEs in coal ash and could support future resource recovery efforts.