The significant carbon footprint of the construction sector necessitates innovative strategies to reduce greenhouse gas emissions while maintaining material performance. This study explores the sustainable potential of biochar in cementitious composites by comparing the effects of two distinct types of biochar: commercially acquired junglee keekar (JK) biochar and laboratory-produced rice stubble (RS) biochar. The diverse performance of these biochar-reinforced composites is elucidated through comprehensive material characterization and extensive testing, including compressive strength, water absorption, drying shrinkage, workability assessment, and SEM/XRD analyses. Furthermore, cost analysis and environmental impact assessment are carried out to assess the overall sustainability of laboratory produced RS biochar. The results reveal that RS biochar excels in compressive strength, with substantial gains across all testing ages. At 28 days, both the RS and JK biocharincorporated mortars prevail over the control mix, with the JK5SP0.5 mix outperforming the control significantly by 23.07%. However, JK biochar-incorporated mortars exhibit higher water absorption rates, especially at lower biochar concentrations. Drying shrinkage trends for both biochar types indicate higher shrinkage at higher concentrations. Flexural strength improvements are apparent in JK biochar mixes and become significant over time. Furthermore, workability decreases with increased biochar content, with lower biochar concentrations producing slightly better workability. SEM and XRD assessments indicate that incorporating biochar does not disrupt the binding material’s structure and distribution, confirming its compatibility with cementitious composites. These findings contribute to the evolving knowledge of sustainable construction materials by revealing that the type and concentration of biochar used can significantly impact material characteristics and environmental performance. This research educates eco-conscious building practices, aligning the construction industry with sustainability goals.