<p>This study carried out the empirical analysis between industrial innovations, military expenditures, and CO₂ emissions in an unattended panel of the Shanghai Cooperation Organization (SCO) countries between 1992 and 2017. The study applied second-generation econometric algorithms, which can address panel heterogeneity and crossectional dependence. The empirical outcomes obtained from Westerlund, Johansson, and Kao cointegration tests responded that the chosen variables have cointegrating relationships. The results of the Driscoll and Kraay estimator pointed out that industrial innovations, military expenditures, and fossil fuel combustion are responsible factors for CO₂ emissions. The VECM-based feedback causality was explored between fossil fuels and CO₂, fossil fuel and income, and income and military expenditures. In contrast, the results supported a unidirectional causal hypothesis from industrial innovations, military expenditures, and income to CO₂ emissions. The negative and significant coefficients of lagged error correction terms (ECT) of income, military expenditure, and fossil fuels have supported the long-run causality with CO₂ emissions by extending that an impulse to these indicators simultaneously reaches equilibrium in the long run. Finally, the obtained results have been discussed, and guidelines are given for the policy implications.</p>