The effects of carbon fiber additions on the electrical, thermoelectric, and magnetotransport performance in p-type CoSb3-based skutterudite are reported. A three-fold enhancement in electrical conductivity and a large increase in magnetoresistance are found. Two different explanations for the increased electrical conductivity are considered; either that carbon atoms form cause defects that makes the CoSb3 more conductive, or that the increase in conductivity is due to electrical percolation of the carbon fibers in the composite. X-ray diffraction data show that the lattice parameter of the CoSb3 is not affected by the presence of the carbon fiber, however adding carbon causes precipitation of 20 wt. % elemental Sb. DFT calculations show that the enthalpy of formation of a solid-solution of carbon (both interstitial and as a substitution for Sb) is favorable. These results support an explanation based on an improved electrical conductivity of a dilute solid solution of C in CoSb3. The average thermoelectric parameters of the composite material, including heat conductivity, average composite Seebeck coefficient, Hall effect, carrier mobility and carrier concentration were influenced by the carbon addition. Unfortunately, the effects largely cancel each other so that the overall zT of the composite was not improved. Finally, large room temperature magnetoresistance (up to 90% at 13T) is observed, which increases with content of carbon fiber.