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The Arctic is experiencing accelerated warming at up to four times the rate of temperate regions, driving permafrost thawing and ground ice melting, which, in turn lead to coastal bluff failure and accelerated erosion. The primary mechanisms behind Arctic coastal bluff failures include the formation of thermoerosional niches at the bluff’s toe and warming-induced reductions in ground strength, making Arctic coastal bluff failure a complex thermal-mechanical coupling process. Most existing studies have focused on coastal bluff failures in temperate regions, but the unique failure mechanism in the Arctic remain underexplored. This study addresses this gap by developing a thermalmechanical coupling model to study the failure mechanism of a permafrost bluff failure that occurred in 2023–2024 in Utqia˙gvik, Alaska. The model incorporates pore ice phase change, thaw-induced reductions in permafrost stiffness and strength, and the effects of thermoerosional niches, cracks, and ice wedges. Stability analysis is conducted via the local factor of safety (LFS) method to account for spatial variations in permafrost strength and stiffness. Ground-penetrating radar (GPR) data from the August 2024 site survey were employed to characterize site conditions, and ground temperature data were used to validate the model. The results revealed two primary failure zones: one near the ground surface and another at the bluff’s toe. The total area of these two failure zones expanded with ongoing thaw. Besides, the results indicated that the increase in thaw thickness, the growth in niche length, and the presence of cracks exacerbate bluff instability, and bluff failure is likely to initiate along the ice wedge–permafrost interface.