As the agricultural sector seeks to feed a growing global population, climate-smart agriculture offers opportunities to concurrently mitigate climate change by reducing greenhouse gas emissions and/or increasing carbon storage in soils. This study examined the potential for clay addition to reduce CO2 emissions from plant residues and soil organic matter in a sandy soil. Soils were sourced from a 15-year-old field trial where claying (200 t ha(-1)) had already demonstrated improvements in water infiltration, grain yield and profits. Isotopically labelled plant residues (wheat, canola, or pea) were used to separate residue-derived and soil-derived CO2 sources from a nil-clay control, a historically clayed, and two freshly created soils with either high (10%) or low (3%) subsoil clay additions. Laboratory incubations demonstrated that historically clayed soils released less CO2 from plant residues and soil organic matter. Clay addition also decreased the priming effect of adding fresh residue to soils. The results from clay experimentally added in the laboratory varied. Differences in chemical and biological indicators (pH, microbial biomass C and N, extractable organic C and N, NO3-, NH4+, abundance of bacterial, archaeal, fungal, LMCO, GH48 and CbhI genes) did not correlate with patterns of CO2 emissions across treatments. While claying practices have previously demonstrated benefits to crop productivity, this research demonstrates long-term changes in carbon-cycling that could promote greater carbon sequestration.