The exploration of non-Hermitian quantum systems, particularly those governed by parity–time (\(\mathscr {P}\mathscr {T}\))-symmetry, has revealed a rich landscape of unconventional phase transitions and localization phenomena. Spin chains with quasiperiodic potentials and competing Heisenberg interactions provide a versatile framework for probing these effects. In this study, we investigate the dynamical and spectral signatures of \(\mathscr {P}\mathscr {T}\)-symmetry breaking and localization-delocalization transitions in spin chains subjected to a non-Hermitian Aubry-André potential and tunable Heisenberg couplings across nearest (\(J_1\)) and next-nearest neighbors (\(J_2\)). Our analysis reveals that increasing \(J_1\) monotonically shifts the critical point \(\lambda _C\), while \(J_2\) induces a non-linear response, generating a distinct minimum in \(\lambda _C\). Notably, \(J_2\) leads to the emergence of partially imaginary eigenvalues beyond \(\lambda _C\), decoupling the onset of \(\mathscr {P}\mathscr {T}\)-symmetry breaking from the localization transition. Using inverse and normalized participation ratios, we identify three distinct phases: extended, localized, and an intermediate hybrid regime characterized by a mobility edge. To capture the dynamical fingerprints of these phases, we employ time-dependent density distribution, long-time survival probability \(\mathrm {P(r)}\), analysis. Extended phases exhibit ballistic spreading and algebraic decay, while localized regimes show spatial confinement and exponential decay. These observables serve as robust indicators of non-Hermitian phase transitions, offering insights beyond static spectral measures. Overall, our findings underscore the critical role of dynamical metrics in characterizing phase structure in non-Hermitian spin systems. As interest in non-equilibrium quantum dynamics continues to grow, such models provide a compelling platform for understanding the interplay between \(\mathscr{P}\mathscr{T}\)-symmetry, localization, and quantum coherence in complex many-body systems.
