Two million people have been killed in a decades-long north-south war in Sudan before a peace deal in 2005.
Violence continues in the western region of Darfur, where international experts estimate that 200,000 have been killed since 2003.
Meanwhile, about seven million people have been forced out from their homes in Sudan's various conflicts, and a recent index published by US-based Foreign Policy magazine put Sudan at the top of a list of the world's most failed states.
Evidence of long-term climate change exists in several parts of the country, with irregular and markedly lower rainfall, especially in the Darfur and Kordofan states, the Nairobi-based UNEP said.
Global warming is widely blamed on greenhouse gases, mainly emitted by burning fossil fuels.
Desertification is Sudan's biggest environmental problem, with the desert expanding southward by 50km to 200km into formerly semi-desert areas since the 1930s, UNEP said.
The report's recommendations include trying to reduce the environmental impact of the oil industry in oil-rich central Sudan and the promotion of more sustainable agriculture.
Current farming methods are rain-fed and poorly managed, leading to large-scale forest clearance, land degradation and loss of wildlife.
According to the report, there has been a loss of nearly 12 per cent of Sudan's forest cover in just 15 years.
The total cost of the report's recommendations is about $120 million over three to five years.
Sudan's government can meet some if not all of these costs, given that its annual oil exports are expected exceed $5bn in 2006, UNEP said.
The crisis is aggravated by the deterioration of oases from deforestation, overgrazing and erosion. But despite serious water shortages, flooding and other related natural disasters are also a factor, the report said.
The most devastating floods occur on the Blue Nile, caused by deforestation and overgrazing in its upper catchment area.
Darfur in particular is beset by a combination of rising population, over-exploitation of resources and an apparent long-term reduction in rainfall, leaving more people on less fertile land.