In modern agriculture, fertilizers are the most significant prerequisite to ensure sustainable crop production, and the intervention of chemical fertilizers has markedly increased crop production and quality. Unfortunately, plants cannot uptake a significant amount of nutrients (>50%) from the applied fertilizers, resulting in low fertilizer use efficiency. The nutrient losses due to leaching, volatilization, denitrification, fixation, erosion, and runoff could result in low fertilizer use efficiency and create environmental pollution as well as a rise in the cost of fertilizer application. To minimize such losses, researchers have suggested various strategies, one of which is the synthesis and application of slow-release fertilizers to extend the bioavailability of nutrients by the sustained release throughout the crop growth period. However, the high cost of current slow-release fertilizers is a major challenge for their widespread use. Carbon-based materials, especially biochar and lignite, have been shown to be effective as soil amendment in recent times. Additionally, these materials have an excellent ability to adsorb nutrients due to their high porosity, surface area, and abundance of functional groups. The cost-effective and abundant supply of these materials across the world can serve as an excellent nutrient-carrier in order to formulate climate-smart and cost-effective slow-release fertilizers. In this review paper, the potential of these materials as nutrient carriers, nutrient adsorption and desorption mechanisms, synthesis methods, nutrient release behavior, and agronomic and environmental implications are discussed in detail for future research priorities as the literature in this direction is very limited and scattered.