Carbon sequestration in soils and terrestrial ecosystems is one of the options to off-set fossil fuel emissions. The global potential of C sequestration in cropland soils is estimated at 0.4-1.2 Pg C yr-1, or 5-15% of the global fossil fuel emissions. In addition to soil, there is also a large carbon sink in biota. Establishment of energy plantations can produce C-neutral biofuels. Land use and soil management techniques to realize this potential include restoration of degraded soils and ecosystems (e.g., afforestation of eroded and compacted soils, reclamation of salt affected soils), conversion of plow till to no-till farming in conjunction with use of cover crops and residue mulch, creation of a positive nutrient balance through use of integrated nutrient management strategies, water conservation in the root zone and use of fertigation techniques, growing improved varieties with favorable root:shoot ratio and containing recalcitrant compounds (e.g., phenolics) etc. Innovative soil and crop management methods need to be developed by use of modern techniques involving nanotechnology and biotechnology, and their adoption facilitated through the use of information technology. Farming carbon through trading of carbon credits provides another income stream for farmers, especially for resource-poor small size holders in developing countries. Enhancing use efficiency of input (fertilizers, irrigation, tillage) is also essential to minimize the hidden cost.