Caustic soda (NaOH) treatment has enhanced rare earth element (REE) extraction from monazite. This study examined the effectiveness of caustic soda for RE-phosphates with lower concentrations for extraction from coal overburden, an alternative feedstock derived from mining waste. Pourbaix (Eh-pH) diagrams were constructed for La, Ce, Nd, Eu, and Y-PO4-H2O systems to understand the thermodynamics of NaOH-facilitated acid leaching for low-concentration RE-phosphates and oxides and to elucidate the difference in recoveries among individual REEs. The Eh-pH diagrams indicated that low crystallinity is beneficial for extraction. Nd was thermodynamically most favorable for the extraction process among the five elements examined, and Y was the least promising. Experiments were conducted using three Pennsylvania coal overburden samples to validate the effect of caustic soda on rare earth leaching. The experimental results showed that for NaOH (6 M), a leaching time of 2 h at 125 °C was sufficient to obtain twice the recovery values compared to those without the NaOH treatment. After implementing the caustic soda treatment, a high total REE recovery (>60%), especially for Nd and Pr, could be achieved with diluted HCl and more environmentally friendlier citric acid. The results were similar for both coarse and fine particles. This novel approach is likely to improve the feasibility of REE extraction from coal-associated feedstock in a more environmentally benign manner.