Biochar has been widely applied to paddy fields to improve soil fertility, crop productivity and carbon sequestration, thereby leading to variations in the CO₂ exchange between the paddy fields under flooding irrigation and the atmosphere, as indicated by many previous reports. However, few relevant reports have focused on paddy fields under water-saving irrigation. This study conducted a field experiment to investigate the effects of three biochar addition rates (0, 20 and 40 t ha⁻¹) on the CO₂ exchange between paddy fields under controlled irrigation (CI, a water-saving irrigation technique) and the atmosphere in the Taihu Lake region of Southeast China. Our results showed that biochar addition increased the paddy field ecosystem respiration (R_eco) and the soil respiration rate (R_s) in the CI paddy fields. And biochar application increased the total CO₂ emissions and the total soil CO₂ emissions, especially at a rate of 40 t ha⁻¹. In contrast, gross primary productivity (GPP) was decreased and the net ecosystem exchange of CO₂ (NEE) was increased with biochar addition. However, biochar addition at a rate of 20 t ha⁻¹ significantly increased the total CO₂ absorption and the net CO₂ absorption of the CI paddy fields (p < 0.05), whereas biochar addition at a rate of 40 t ha⁻¹ had no effect on the total CO₂ absorption and decreased the total net CO₂ absorption. At the same time, biochar addition significantly increased soil catalase, invertase and urease activities and contributed substantially to the increase in soil invertase activity. In addition, the soil bacterial, fungal and actinomycetal abundances were evidently increased with biochar addition, of which the soil fungal abundance showed the greatest increase. A high correlation was observed between soil catalase and invertase activities and soil microbial abundance. R_eco was highly correlated with air and soil temperatures and soil enzyme activity. A significant quadratic polynomial correlation was observed between GPP and leaf area index (p < 0.01). The combination of biochar addition at a rate of 20 t ha⁻¹ and water-saving irrigation has the potential to increase the size of the carbon sink and promote soil enzyme and microbial activities in paddy field ecosystems.