Assessment of carbon stocks in vegetation and soil is a basic step in evaluating the carbon sequestration potential of an ecosystem. We collected soil (core and composite) samples from 0–10, 10–20, 20–40, and 40–70 cm depths, or down to the bed rock, in the soil profile of four types of forest (managed dense Shorea (DS), degraded forest (DF), pine mixed (PS), and Schima–Castanopsis (SC) forest) and two types of cultivated land (irrigated low land (Khet) and rain-fed upland (Bari)) in the Pokhare Khola watershed of Nepal. In addition to other essential properties, soil bulk density and carbon concentration were assessed. Fine roots were also collected from each sampling site. The biomass of standing trees and shrubs was estimated by using allometric relationships after measuring their diameter and height, while the biomass of grasses was estimated by a direct measurement of grass from a defined area. The carbon stocks in all forest vegetation (trees, shrubs, and ground grass) and in the soil profiles under different land uses were estimated. The vegetation carbon pool was largest in DS forest (219 ± 34 Mg ha−1) and least in SC forest (36 ± 5 Mg ha−1), while its order among forest types was DS > DF > PS > SC. The soil organic carbon (SOC) pool was largest in Bari land (15.7 ± 1.5 kg C m−2) and least in PS forest (6.2 ± 0.5 kg C m−2) but the overall order among land uses was Bari > DF > Khet > SC > DS > PS. The total SOC stock in the whole watershed was 59 815 Mg, of which 36, 32, and 32% were in the 0–20, 20–40, and >40 cm soil depths, respectively. In the surface layer (0–10 cm), SOC stock was highest in Bari (36%) followed by DS (31%), and least was in PS forest (3%). This distribution pattern can primarily be assigned to SOC concentration and area covered by these land uses.