The well-documented energy balance dynamics within forest ecosystems are poorly implemented in studies of the biophysical effects of forests. This results in limitations to the accurate quantification of forest cooling/warming on local air temperature. Taking into consideration the forest air space, this study proposes a three-layered (canopy, forest air space and soil [CAS]) land surface energy balance model to simulate air temperature within forest spaces (T) and subsequently to evaluate its biophysical effects on forest cooling/warming, i.e., the air temperature gradient (∆T) between the T and air temperature of open spaces (T) (∆T = T - T). We test the model using field data for 23 sites across 10 cities worldwide; the model shows satisfactory performance with the test data. High-latitude forests show greater seasonal dynamics of ∆T, generating considerable cooling of local air temperatures in warm seasons but minimal cooling or even warming effects during cool seasons, while low-latitude tropical forests always exert cooling effects with less interannual variability. The interannual dynamics of ∆T are significantly related to the seasonality of solar geometry and canopy leaf phenology. The differences between forest canopy temperature (T) and T, which are the two most important terms attributed by the CAS model in impacting T, explain a large part of forest cooling and warming (May-July: R = 0.35; November-January: R = 0.51). The novel CAS model provides a feasible way to represent the energy balance within forest ecosystems and to assess its impacts on local air temperatures globally.