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Climate change will affect the regional ability to achieve the poverty reduction and sustainable development (SD) objectives. Thus, any action plans to achieve these objectives should make climate change policies an integral part of the development planning process. The best practices and measures of climate change policies should be implemented to ensure regional or community sustainability. In this paper, a case study that promotes the integration of carbon sequestration into sustainable forest management and rural development plan with multi-stakeholders participation is introduced. To achieve SD goals, appropriate tools and methods are required to address impacts of alternative forest land uses on carbon sequestration and rural sustainability, and to prioritise land use options. A range of forest land use scenarios that address various aspects of the forest carbon sequestration rate and rural sustainability are evaluated against a SD indicator system. Planting vegetation is one of the practical approaches in mitigating global warming by sequestrating carbon from the atmosphere to plant matter and soil. In order to protect environment, reduce excessive soil erosion, and decrease the propensity and frequency of flooding and other natural disasters, China has initiated nationwide pivotal projects such as “Grain for Green” to mitigate exacerbated environmental deterioration and degradation. Such ecological programs may affect the socio-economic livelihoods of peasants and the economic activities of the whole region. The impact and economic uncertainty associated with such projects urge policy makers to include all stakeholders in the decision making process so that an agreeable solution towards sustainable rural development can be identified. This study uses Liping County in Guizhou province as a case study to identify a consensus among peasants regarding planting selected tree-species. Analytic hierarchy process (AHP) is used as a multicriteria decision making tool to rank sustainability criteria and determine the priority of options. The method helps policy makers to understand what the peasants want to achieve by participating in a Grain for Green program and what their priorities are with respect to particular types of vegetation. The case study finds that economic and financial concerns are the most important drivers of the decision of which trees to plant among the peasants who took part in the implementation of the Grain for Green program. As a result of this, Gingko, redpine, and Chinese chestnut were the predominant trees planted under the program. The integrated assessment based on the AHP method provides an effective tool to help understand how economic, social and environmental factors are related to each other in affecting the nature of rural sustainability.