Cyanobacterial-dominated ecosystems play a crucial role in global carbon cycling and sequestration, influencing both atmospheric CO2 levels and aquatic carbon dynamics. This chapter explores the mechanisms by which cyanobacteria contribute to carbon fixation, organic matter production, and long-term carbon storage. Cyanobacteria act as primary producers in freshwater and marine environments, utilizing photosynthesis to convert CO2 into biomass, which fuels aquatic food webs and supports microbial decomposition pathways. Their ability to fix inorganic carbon through various carbon-concentrating mechanisms (CCMs) enhances their competitive advantage in nutrient-rich and low-CO2 environments. The interplay between carbon, nitrogen, and phosphorus cycles in cyanobacterial blooms is examined, highlighting the role of organic carbon production in shaping microbial community dynamics and sediment carbon deposition. Additionally, the impact of harmful cyanobacterial blooms (HCBs) on carbon fluxes is discussed, particularly in relation to dissolved organic carbon (DOC) release, oxygen depletion, and greenhouse gas (GHG) emissions such as methane (CH4) and nitrous oxide (N2O). The sequestration potential of cyanobacterial-derived organic carbon in sediments and its contribution to long-term carbon storage is also addressed. Understanding the processes governing carbon cycling in cyanobacterial ecosystems is critical for predicting their response to climate change and anthropogenic disturbances. This chapter evaluates strategies for enhancing carbon sequestration in aquatic ecosystems, including bloom management, biogeochemical modeling, and nature-based solutions. By integrating ecological and biogeochemical perspectives, this chapter provides insights into the role of cyanobacteria in regulating carbon fluxes and maintaining ecosystem stability.