Land use policies have turned southern China into one of the most intensively managed forest regions in the world, with actions maximizing forest cover on soils with marginal agricultural potential while concurrently increasing livelihoods and mitigating climate change. Based on satellite observations, here we show that diverse land use changes in southern China have increased standing aboveground carbon stocks by 0.11 ± 0.05 Pg C y−1 during 2002–2017. Most of this regional carbon sink was contributed by newly established forests (32%), while forests already existing contributed 24%. Forest growth in harvested forest areas contributed 16% and non-forest areas contributed 28% to the carbon sink, while timber harvest was tripled. Soil moisture declined significantly in 8% of the area. We demonstrate that land management in southern China has been removing an amount of carbon equivalent to 33% of regional fossil CO2 emissions during the last 6 years, but forest growth saturation, land competition for food production and soil-water depletion challenge the longevity of this carbon sink service.