Aiming at the challenges of rapid heat dissipation, limited swept efficiency, and a rapid water cut increase in steam huff and puff development in heavy oil reservoirs, an alternating steam and CO2/viscosity reducer huff and puff method for IOR was proposed. In this work, the effect of CO2 on the physical properties of heavy oil was evaluated, and the optimal concentration of viscosity reducer for synergistic interaction between CO2 and the viscosity reducer was determined. Next, novel huff and puff simulation experiments by three sandpack models of different sizes in series were analyzed. Then, the IOR difference between the pure steam huff and puff experiments and the steam-alternating CO2/viscosity reducer huff and puff were compared. Finally, the CO2 storage rate was obtained based on the principle of the conservation of matter. The results show that the optimal viscosity reducer concentration, 0.8 wt%, can achieve a 98.5% reduction after combining CO2. The steam-alternating CO2/viscosity reducer huff and puff reached about 45 cm at 80 °C in the fifth cycle due to the CO2/viscosity reducer effects. CO2/viscosity reducer huff and puff significantly reduces water cut during cold production, with an ultimate IOR 15.89% higher than pure steam huff and puff. The viscosity reducer alleviates heavy oil blockages, and CO2 decreases oil viscosity and enhances elastic repulsion energy. The highest CO2 storage rate of 76.8% occurs in the initial stage, declining to 15.2% by the sixth cycle, indicating carbon sequestration potential. These findings suggest that steam-alternating CO2/viscosity reducer huff and puff improves heavy oil reservoir development and provides theoretical guidance for optimizing steam huff and puff processes.