Carbon credits play a vital role in combating climate change by enabling both regulatory and voluntary efforts to reduce greenhouse gas emissions. As emissions from fossil fuels and deforestation rise, carbon credits offer a market-driven solution to support clean energy, reforestation, and sustainable practices. This report outlines how carbon credits function, their role in compliance and voluntary markets, and the impact of emerging technologies like blockchain, AI, and satellite monitoring in enhancing transparency and efficiency. It also addresses key challenges and highlights the growing importance of diversified, tech-enabled carbon markets in achieving global net-zero goals.