Data from 57 permanent monitoring sites are used to document the growth in woody vegetation and estimate the carbon sink in 27 M ha of eucalypt woodlands (savannas), contained within c. 60 M ha of grazed woodlands in Queensland (northeast Australia). The study sites are shown to be representative of the environment and structure of the eucalypt woodlands in the defined study area. Mean basal area increment for all live woody plants in 30 long-term sites, with an average initial basal area of 11.86 ± 1.38 (SE) m2 ha−1, was 1.06 m2 ha−1 over a mean 14 years timeframe. The majority of the measurement period, commencing between 1982 and 1988, was characterized by below-average rainfall. The increase in live tree basal area was due primarily to growth of existing trees (3.12 m2 ha−1) rather than establishment of new plants (0.25 m2 ha−1) and was partly offset by death (2.31 m2 ha−1). A simple but robust relationship between stand basal area and stand biomass of all woody species was developed for the eucalypt dominant woodlands. Analysis of above-ground carbon stocks in live and standing dead woody plants gave a mean net above-ground annual carbon increment for all 57 sites of 0.53 t C ha−1 y−1, similar to values estimated elsewhere in world savannas. Published root : shoot ratios were used to infer C flux in woody root systems on these sites. This results in an estimated sink in above- and below-ground biomass of 18 Mt C y−1 over the eucalypt woodlands studied, and potentially up to 35 Mt C y−1 if extended to all grazed woodlands in Queensland. It is suggested that introduction of livestock grazing and altered fire regimes have triggered the change in tree-grass dominance in these woodlands. Thus, change in carbon stocks in the grazed woodlands of Queensland is identified as an important component of human-induced greenhouse gas flux in Australia, equivalent in magnitude to c. 25% of the most recently published (1999) total estimated national net emissions. The latter inventory takes into account emissions from land clearing, but does not include the sink identified in the present study. This sequestration also represents a small but significant contribution to the global terrestrial carbon sink.