Heavy rare earth elements (HREEs), particularly dysprosium (Dy) and terbium (Tb), are essential for high-performance magnets yet challenging to separate due to similar electronic structures. This study demonstrates Alkali/Urea dissolved Chitosan Hydrogels (AUCH) for selective HREE extraction from mine waste. Two crosslinking strategies created pH-optimized materials: AUCH-D (1,2,7,8-diepoxyoctane) for acidic conditions and AUCH-G (glutaraldehyde) for alkaline environments. AUCH materials achieved exceptional sorption capacities of 162.53 mg/g for Tb (III) and 132.05 mg/g for Dy (III), following pseudo-second-order kinetics and Langmuir isotherms. Thermodynamic analysis revealed endothermic processes with activation energies of 32.22-68.28 kJ/mol, indicating inner-sphere complexation mechanisms. AUCH-D showed distinct binding energetics: ΔH = 17.88 kJ/mol for Dy (III) vs 76.13 kJ/mol for Tb (III), providing new insights for selective separation design. Field validation using Pea Ridge mine samples achieved 95.77% Tb (III) removal from acidic drainage and 78.06% Dy (III) removal from alkaline tailings while maintaining selectivity against competing lanthanides. Materials retained >70% capacity after five regeneration cycles, demonstrating sustainable HREE recovery from secondary sources.