Environmental gradients (altitude) are the factors that determine the carbon capturing the potential of a given forest. This study was conducted to determine the influence of elevation in the Yegof mountain forest’s carbon sequestration potential. A total of 57 quadrats of 20 m by 20 m, 5 m by 5 m and 1 m by 1 m with nine horizontal transect lines were used for collecting the data on tree, shrub, and herbaceous and/or soil, respectively, in the three altitudinal gradients. The vegetation and soil data were analyzed statically in one-way analysis of variance using R software. Aboveground carbon (AGC) and belowground carbon (BGC) stocks were significantly higher (P < 0.001) in upper altitude (UA) gradient with 187.3 ± 27 ton ha−1 and 37.5 ± 5.4 ton ha−1, respectively, than other gradients. However, lower altitude (LA) has a significantly higher (P < 0.05) soil organic carbon (SOC) value than the other two altitudinal gradients with 266.07 ± 51.61 ton ha−1, followed by middle altitude (MA) with 194.55 ± 26.07 ton ha−1. Nevertheless, the overall carbon sock (TCS) was higher in MA (415.3 ton ha−1) with a slight difference from the UA (414.2ton ha−1). The study has found that environmental factors have a profound effect on carbon stocks, but the effect is not similar among the four carbon pools. Carbon stock value of Yegof mountain forest was highly affected by environmental factors such as altitude. Therefore, better ecological, policy and socioeconomic concerns should be adopted in the area especially in LA than the other gradients as it possesses the poorest performance of all in the majority of carbon pools.