It's definitely possible. You'll need a lot of additional resources (brushes, textures) to speed up the process, then a lot of layers of duplicated resources.
Whether or not Photoshop is solely the right tool is another question you should ask. I wonder if it'd be easier to model the viewable parts of the world in 3D then render to 2D (then possibly some Photoshop touch ups for atmosphere), rather than layering resources together in 2D and touch them up.