Tanzania is rich in biodiversity but faces rapid deforestation and severe poverty. Villages own 46% of forests, but resource limitations hinder effective management and deforestation continues apace. Carbon credits offer potential incentives for climate mitigation and biodiversity preservation, yet their applicability to village forests remains unproven at scale. There is a lack of rigorous evidence on the costs and benefits of carbon markets for community-managed forests, which restricts communities’ ability to make informed decisions and ensure that climate mitigation and biodiversity protection is achieved equitably. This project aims to collaborate closely with local communities to evaluate the feasibility of carbon credit schemes, considering costs, benefits and governance. Additionally, we will focus on capacity-building initiatives for village governments and stakeholders, empowering them to navigate carbon markets effectively. Through this approach, we aim to harness the power of carbon markets to combat climate change, safeguard biodiversity, and alleviate poverty in Tanzania’s forested areas. Therefore, assessment of the viability of carbon as a revenue source as well as capacity building for stakeholders from all levels will help to sustain Participatory Forest Management (PFM) and help stakeholders to understand the linkage between REDD+, PFM as well as the voluntary carbon and biodiversity markets, and ensure that local experiences inform the development of those markets. The project is funded by the Department for Environment, Food and Rural Affairs (Defra) UK in partnership with UK International Development and Development Alternatives, Inc (DAI) through the Global Centre on Biodiversity for Climate. The project is implemented by Sokoine University of Agriculture (Lead Organization) in partnership with Bangor University in Wales, United Kingdom.