Biochar is a promising amendment for improving soil carbon (C) sequestration and supplying potassium (K). However, the interrelationship between soil organic carbon, potassium availability, and microbial functions under the co-application of biochar and exogenous K remains largely unknown. Therefore, we conducted a four-year experiment that involved four K fertilizer application rates (0%, 60%, 80%, and 100% of conventional K fertilizer, respectively) combined with two doses of biochar rate (0% and 2%). We utilized a combination of high-throughput sequencing and GeoChip technology to examine the microbial responses to changes in soil organic C and K pools. The results revealed that biochar had the potential to replace 40% of conventional K fertilizer. The simultaneous application of biochar and conventional K fertilizer increased soil available K content by 192.3% and enhanced citrus growth. Additionally, soil organic matter, humus components, and aromatic C groups were significantly influenced by the addition of biochar. Soil enzyme activities associated with C cycling improved by 31.9%–84.4%. Furthermore, altered microbial communities, higher bacterial diversity, and enhanced microbial carbon source utilization capacity were observed in soil treated with the combined application of biochar and K fertilizer. The improvement of soil K availability induced by the co-application of biochar and K fertilizer resulted in a 35.2% increase in the microbial functions responsible for liable C degradation. Overall, the 4-years of co-application of biochar and K fertilizer increased the availability of soil potassium and the storage of organic carbon by 2.9- and 1.8-fold, respectively, which is conducive to promoting sustainable agricultural development.