Designing sustainable food and agricultural systems is a pressing need at a time when we already are at the low end of achieving SDG 13 (Climate Action) of reducing carbon emissions. In such a scenario, this study has the potential to provide an insightful framework for policymakers. The major objective of this study is to estimate the carbon sequestration of tree crops, and soil analysis in homestead agroforestry systems (AFS), monocropped rubber plantations, and monocropped coconut plantations in the Alappuzha and Kollam districts of Kerala. The soil carbon parameters analyzed were soil organic carbon (SOC) and labile carbon. Other parameters, such as pH and electrical conductivity of soil, were also measured. The soil of rubber plantations had the least pH (4.8) and EC (79 µS/cm). We found the tree carbon sequestration of rubber trees in the plantations to be the highest (13.8 t C ha −1 year −1 ) followed by homestead AFS (2.68 t C ha −1 yr −1 ) and coconut tree plantation (2.08 ± 0.53 t C ha −1 year −1 ). The tree carbon sequestration potential was significantly (p = 0.003) influenced by the treatments. In soil, the SOC content was highest in the homestead AFS (2.48%). The labile carbon was also found to be higher in the homestead AFS (0.06%) but was least in rubber plantation (0.04%). These results indicate that even though the tree carbon sequestration of homestead AFS is lesser compared to that of large tree plantations such as rubber. The soil carbon pools and other physical and chemical properties of soil promote the valuable contribution that homestead can play in the sustainability of the environment and ensuring food security.