To evaluate the changes in the pool of organic carbon fractions, aggregate stability and activity of enzymes, degraded red soil was amended with three different rates (0.5, 1.0 and 2%) of oak wood biochar (W 0.5 , W 1.0 , W 2.0 ) and bamboo biochar (B 0.5 , B 1.0 , B 2.0 ), with control as 0%. After 372 days, the incubated soils were analyzed for total organic C (TOC), potassium permanganate oxidizable C (POXC), light fraction organic C (LFOC), water soluble organic C (WSC), hot-water extractable C (HWC) and microbial biomass C (MBC), macroaggregates (> 0.25 mm), dehydrogenase, β-glucosidase and urease. The highest macroaggregates, POXC, LFOC, HWC, MBC and enzyme activities were measured in the lowest rates (W 0.5 and B 0.5 ). MBC positively correlated with all labile organic C and macroaggregates, indicating that microbial activities result in mineralization of organic matter (OM) and contribute on bonding agent for macroaggregation. The C/N of the experimental soil negatively correlated with most of labile organic carbons and macroaggregates, which could be the effect of limited N availability on labile organic carbon fraction and aggregation. As compared to the control, lability index (LI) (changes in the lability of soil carbon) increased in W 0.5 and B 0.5 by 4 and 6%, respectively, whereas the carbon management index (CMI) (changes of the total carbon in the soil and its lability) increased by ranges of 50 to 286% in the treatments, and implies sequestration of organic C in soil. The high CMI is largely caused by high C sequestration and low lability differences between the treatments. Our results suggest that biochar application increases total organic carbon, stimulates microbial activities, in turn increases macroaggregation, and thus soil quality.