Background Many researchers have aimed to develop chronic health surveillance systems to assist in public health decision-making. Several digital health solutions created lack the ability to explain their decisions and actions to human users. Objective This study sought to (1) expand our existing Urban Population Health Observatory (UPHO) system by incorporating a semantics layer; (2) cohesively employ machine learning and semantic/logical inference to provide measurable evidence and detect pathways leading to undesirable health outcomes; (3) provide clinical use case scenarios and design case studies to identify socioenvironmental determinants of health associated with the prevalence of obesity, and (4) design a dashboard that demonstrates the use of UPHO in the context of obesity surveillance using the provided scenarios. Methods The system design includes a knowledge graph generation component that provides contextual knowledge from relevant domains of interest. This system leverages semantics using concepts, properties, and axioms from existing ontologies. In addition, we used the publicly available US Centers for Disease Control and Prevention 500 Cities data set to perform multivariate analysis. A cohesive approach that employs machine learning and semantic/logical inference reveals pathways leading to diseases. Results In this study, we present 2 clinical case scenarios and a proof-of-concept prototype design of a dashboard that provides warnings, recommendations, and explanations and demonstrates the use of UPHO in the context of obesity surveillance, treatment, and prevention. While exploring the case scenarios using a support vector regression machine learning model, we found that poverty, lack of physical activity, education, and unemployment were the most important predictive variables that contribute to obesity in Memphis, TN. Conclusions The application of UPHO could help reduce health disparities and improve urban population health. The expanded UPHO feature incorporates an additional level of interpretable knowledge to enhance physicians, researchers, and health officials' informed decision-making at both patient and community levels. International Registered Report Identifier (IRRID) RR2-10.2196/28269