The Canopus ST failed to part from its booster rocket after the Friday launch from the Plesetsk military cosmodrome in northwestern Russia, changing the planned trajectory, space officials told the Itar-Tass news agency on Monday.
The satellite, which took a decade to develop, was equipped with advanced cameras that could scan oceans, identify submarines underwater and detect forest fires that devastate Russia's forests every year.
Moscow planned to launch four Canopus satellites, Viktor Selin, of the Russian Space Systems company, said last month.
The imminent loss of Canopus ST marks another disaster for Russia's space industry that still prides itself on the launch of the first satellite and the first manned mission in human history.
"This is a systemic problem. We're dealing with the leftovers of the Soviet space industry that have been in the deepest crisis in recent years," Pavel Luzin, an independent industry expert, told Al Jazeera.
Military satellites are especially vulnerable because Russian engineers refrain from using foreign-made components citing security concerns.
"With military satellites trouble happens more often. Their life cycle is just two-three years," said Luzin.
A string of disasters
The Canopus ST loss is the latest in a series of mishaps for Russia's once-celebrated space industry.
In May, a Proton-M rocket carrying a Mexican satellite burned up over Siberia minutes after the launch from Kazakhstan's Baikonur cosmodrome, which Russia leases and operates.
In 2013, a rocket carrying three Glonass navigation satellites crashed - Russian media had lauded the Glonass as a domestic alternative to the US-designed Global Positioning System.
Meanwhile, Russia has delayed the first launch from its Vostochny (Eastern) cosmodrome because the completion of the sprawling spaceport near the Chinese border has been behind schedule because of corruption scandals and technical glitches.
'Space taxi'
The Soviet Union pioneered space explorations by launching the first Sputnik in 1957 and the first cosmonaut in 1961.
The launches were celebrated as major achievements of the Communist system, and a space race with the US raged on for decades.
The Soviets praised the safety of their space ships, including the Soyuz workhorse which was developed in the early 1960s and is still used for manned launches.
After the 1991 Soviet collapse, the underfunded space industry was reduced to the role of "space taxi".
Hundreds of satellites owned by Western companies have been launched from Baikonur, and seven "space tourists", mostly rich Western businessmen, reportedly paid tens of millions of dollars for a chance to orbit the Earth for several days.
When the US stopped using space shuttles in 2011, Russia remained the only nation capable of launching manned flights to the International Space Station, a mammoth structure in low Earth orbit that has been continuously manned for more than 15 years.
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