The role of forests in mitigating the effect of climate change depends on the carbon sequestration potential and management. This study was conducted to estimate the carbon stock and its variation along the environmental gradients in Arba Minch Ground Water Forest. The data was collected from the field by measuring plants with a DBH of >5cm in quadrat plots of 10 X 20 m and the carbon stocks of each plant were analyzed by using allometric equations. From this study the mean total carbon stock density of Arba Minch Ground Water Forest was found to be 583.27 t ha-1, of which 829.12 t ha-1, 165.88 t ha-1, 1.28 t ha-1, 83.80 t ha-1 was contained in the above ground carbon, belowground carbon, litter carbon and soil organic carbon (0-30 cm depth) respectively. This study will serve as a potential entry point for the engagement of the forest in REDD project.