Yes, it is absolutely possible that an industrial revolution and modern technology could arise in Tamriel as seen in the Elder Scrolls game series.
The Elder Scrolls games have already demonstrated this potential for industrialization and modern technology through the usage of automatons, golems, automatized palaces and strongholds, and the airship. Additionally, some of the more advanced races in the Elder Scrolls universe have shown advanced technology such as the Dwemer and the Falmer. However, it is important to remember that these advances are still relatively primitive compared to those seen in our world, but still hold potential for an industrial revolution to take place.
The key to unlocking this potential lies in the use and mastery of powerful magic. In Tamriel, powerful magical forces and the mysterious numinous substance of the Elder Scrolls has been known to power and create some of the more advanced items seen in the game. Thus, it is reasonable to assume that with the right mastery of magic, the industrial revolution could definitely become a reality in Tamriel.
However, it would be up to the players and game masters to unlock this potential and actually bring the industrial revolution to Tamriel, as it is ultimately left up to their creativity and capabilities. The possibilities are truly endless, and the Elder Scrolls games show us that modern industrial capabilities can be achieved with the right amount of knowledge, effort and perseverance.
Ultimately, with the right ability and understanding of the magical and technological forces available in Tamriel, an industrial revolution could arise, full of new and fantastic wonders and advancements.