The Common Agricultural Policy (CAP) is the European Union's main instrument for agricultural planning, with a new reform approved for 2023-2027. The CAP intends to be aligned with the European Green Deal, a set of policy initiatives underpinning sustainable development and climate neutrality in the EU, but several flaws cast doubts about the compatibility of the objectives of these two policies. We reviewed recent literature on the potential of CAP environmental objectives for integration with the Green Deal: protection of biodiversity, climate change mitigation and adaptation, and sustainable management of natural resources. We found the CAP lacks appropriate planning measures, furthering instead the risk to biodiversity and ecosystem services driven by landscape and biotic homogenization. Funding allocation mechanisms are not tailored to mitigate agricultural emissions, decreasing the efficiency of climate mitigation actions. The legislation subsidises farms making extensive use of synthetic inputs without adequately supporting organic production, hindering the transition towards sustainable practices. We recommend proper control mechanisms to be introduced in CAP Strategic Plans from each Member State, to ensure the EU is set towards a sustainable production and consumption path. These include proportional assignment of funds to each CAP objective, quantitative targets to set goals and evidence-based interventions, and relevant indicators to facilitate effective monitoring of environmental performance. Additionally, both the CAP and the Green Deal should maintain ambitious environmental commitments in the face of crisis, to avoid further degradation of the natural resources on which our production systems stand.