a b s t r a c tSoil erosion not only results in severe ecological damage, but also interferes with soil organic carbon formation and decomposition, influencing the global green-house effect. However, there is controversy as to whether a typical small watershed presumed as the basic unit of sediment yield acts as a CO 2 sink or source. This paper proposes a discriminant equation for the direction of CO 2 flux in small watersheds, basing on the concept of Sediment Delivery Ratio (SDR). Using this equation, watersheds can be classified as Sink Watersheds, Source Watersheds, or Transition Watersheds, noting that small watersheds can act either as a CO 2 sink or as a CO 2 source. A mathematical model for calculating the two discriminant coefficients in the equation is set up to analyze the conditions under which each type of watershed would occur. After assigning the model parameter values at three levels (low, medium, and high), and considering 486 scenarios in total, the influences are examined for turnover rate of the carbon pool, erosion rate, deposition rate, cultivation depth and period. The effect of adopting conservation measures like residue return, contour farming, terracing, and conservation tillage is also analyzed. The results show that Sink Watersheds are more likely to result in conditions of high erosion rate, long cultivation period, high deposition rate, fast carbon pool turnover rate, and small depth of cultivation; otherwise, Source Watersheds would possibly occur. The results also indicate that residue return and conservation tillage are beneficial for CO 2 sequestration.