Plant-parasitic nematodes are important pests of sugarcane worldwide, causing more than $80 million loss in productivity per year in Australia. A second group of nematodes are known as 'free-living' and feed on bacteria, fungi or on other nematodes. Free-living nematodes are vital contributors to soil health through their involvement in mobilisation of nitrogen and carbon and are important indicators of soil health. The objectives of this study were to determine the extent of plant-parasitic nematodes and their potential impact on sugarcane production in three mill areas in New South Wales, and the use of nematode community analysis to determine the soil health of the surveyed sugarcane farms. Soil samples were collected from 43 locations from three mill areas, Broadwater, Condong, and Harwood. Sixteen farms (37%) surveyed had medium (>300 nematodes/200 g soil) and 19 farms (44%) had high (>800 nematodes/200 g soil) numbers of root-lesion nematodes. Spiral nematodes were the only other abundant species and occurred in all farms surveyed. A nematode hazard index (HI) was developed by adding the weighted number of plant-parasitic nematodes. Approximately 93% of surveyed farms had medium (>300) to high (>800) HI values, an indication of moderate (5% to 20%) to high (>20%) potential yield loss. Soil food-web indices and metabolic-footprint indices also indicated perturbation of sugarcane soil and a farming system dominated by herbivorous nematodes. This survey demonstrated that plant-parasitic nematodes are prevalent in New South Wales cane-growing areas and are probably causing yield loss.