With changes in climate and increasing resource scarcity in the future, transition towards a more sustainable and resilient agriculture system that promotes maintenance of a range of ecosystem services is important. Meanwhile, significant global greenhouse gas reduction targets require all sectors including agriculture to take radical actions immediately. Carbon farming is a promising approach which can contribute to mitigating climate change, increase soil accumulation and fertility, enhance ecosystem services and increase productivity within a range of farming systems. Currently, Sweden does not have any formal carbon farming projects. As the implementation of carbon farming is likely to be location, technology and circumstance specific, a case study was undertaken in Sweden in order to cast light on the envisaged synergies and trade-offs associated with carbon farming by assessing the opportunities and barriers to farmer’s sustainable livelihoods. Eleven pilot farmers from south and central Sweden participated in the case study. Data were collected through online survey. Findings suggest that opportunities and barriers to enhance the carbon sink potential of farmlands are closely linked to people’s livelihoods as well as their broader context and; Swedish farmers are interested in incorporating carbon farming practices within their existing farming systems. Further, opportunities and barriers were found in relation to different assets, external shocks and the policy environment. Moreover, carbon farming has the potential to promote sustainable rural livelihoods in Sweden by reducing farmer’s vulnerability context and enhancing farmer’s assets and livelihood strategies.