Abstract: Defining municipal carbon balance zones in China is of great significant for promoting high-quality development and achieving the ‘dual carbon’ goals. This study explores the spatiotemporal patterns of carbon emissions and expenditures in 296 prefecture-level and above cities in China from 2001 to 2023. Using EDGAR carbon emissions data and other information, we introduce ECC (the carbon emission economic contribution coefficient) and ESC (the carbon ecological carrying capacity coefficient) to analyze energy use efficiency, carbon sink capacity, and carbon balance zoning status (excluding the data of Hong Kong, Macao and Taiwan). Ultimately, we combine these with the main function zoning strategies in territorial spatial planning to optimize carbon balance zoning. The results show that: (1) In 2001, 2012 and 2023, carbon emissions in China followed a pattern of ‘High in the middle, low around the edges’ with high-value areas concentrated in eastern urban agglomerations such as the Beijing-Tianjin-Hebei region and the Shandong Peninsula. The peak emissions reached 2.836 billion tons in 2023. Low-emission areas were mainly found in the Chengdu-Chongqing region and the middle reaches of the Yangtze River, and other urban agglomerations in the central and western China. Meanwhile, the high value of carbon absorption increased from 9.725 crore tons in 2001 to 2.138 billion tons in 2023, with ‘high in the northeast and southwest, low in the central region’, with urban agglomerations such as Harbin-Changchun and the Beibu Gulf region at its core. (2) The ECC shows a shift and gradual growth from the southeast coast toward the southwest. There is significant pressure to reduce emissions in economically vital regions like Beijing-Tianjin-Hebei and the Yangtze River Delta. The ESC is generally stable, with a pattern of ‘high in the west and south, low in the east and north’ Western urban agglomerations such as Lanxi and Hubao-E-Yu show increasing ecological carrying capacity, while the ecological carrying capacity of eastern urban agglomerations is gradually improving despite remaining low. (3) Optimizing carbon balance zoning based on the main functional zones reflects the conditions of regional development. Economic development zones, which are the key development zones, are concentrated in the central and eastern part of the country, including the middle reaches of the Yangtze River and Harbin-Changchun and other urban agglomerations. Comprehensive Optimization Zones-Optimization and Development Zones are least common in the Hubao-E-Yu urban agglomeration. Overall, this study shows that there has been an increase in both carbon emissions and carbon sequestration, as well as a significant increase in the carbon sink function of urban agglomerations. There is significant spatial heterogeneity in ECC and ESC. These findings provide strong support for the implementation of green economy policies.