Moso bamboo is widely distributed in southern China and plays an important role in terrestrial C cycling. However, the implications of extensive management on soil properties, C sequestration, and plant restoration in degraded forests remain poorly understood. Here, four representative areas with four comparable stands each were selected for analysis, including those that have been extensively managed (stand age of 19, 37, and 64 years) and intensively managed control stands. Soil was collected and examined from depths of 0–20 and 20–40 cm in all 16 stands. The results show that increases in the duration of extensive management significantly increased the total organic C contents, its fractions, the C mineralization rate, soil pH, and total N in the 0–20 and 20–40 cm soil layers, accompanied by increases in aggregate stability. Amorphous and organically complexed Fe contents also increased. Increased extensive management significantly promoted the establishment, growth, and productivity of understory vegetation, with increases in richness, evenness, biomass, and diversity observed in the shrub layers. This positively affected soil organic C (SOC), aggregate stability, and amorphous Fe, suggesting that increased soil C stocks were driven by increased C input and preservation from enhanced shrub diversity. The physical protection of C fractions and amorphous Fe significantly impacted soil C sequestration considering different management strategies. Protection of shrub diversity may have accelerated the long-term storage and stabilization of SOC and restoration of soil functions.