Biochar-based fertilizers (BBFs) are an emerging type of engineered fertilizers that combine biochar with beneficial microorganisms to enhance plant nutrition and improve soil properties. BBFs are now considered to be a sustainable strategy to enhance soil health and sequester carbon, offering significant advantages over conventional mineral fertilizers. Biochar is a porous, charcoal-like material produced through pyrolysis, a process of heating organic matter in the absence of oxygen. It enhances soil health by improving chemical, physical, and biological characteristics. Its effectiveness is influenced by the feedstock used and the production conditions, both of which affect its final properties. Chemically, biochar increases nutrient retention and regulates soil pH, creating a more favorable environment for plant growth. Physically, its porous structure boosts water-holding capacity, ensuring better water availability for plants. Biologically, biochar fosters beneficial microbial activity, supporting soil biodiversity and plant health. This chapter reviews the role of biochar-based fertilizers in enhancing soil fertility and examines the key characteristics of biochar. It also examines biochar’s impact on soil physicochemical properties and explores its biological effects, with an emphasis on shifts in soil microbial activity, enzyme functions, and the enhancement of soil microbial communities. By showcasing the diverse benefits of biochar-based microbial fertilizers, this chapter highlights their potential to enhance agricultural sustainability, increase crop yields, and aid in climate change mitigation through carbon sequestration. Understanding the interactions between biochar properties and soil characteristics is crucial, as the effects depend on both the type of biochar applied and the specific soil conditions.