The rapid growth of global industrialization and urbanization has led to the excessive use of non-renewable energy sources and the alarming release of greenhouse gases within the construction industry. In response, adopting sustainable and environmentally friendly building materials has emerged as a vital solution for achieving the international sustainable development goals set by the United Nations. This review discusses the potential benefits of incorporating biochar-based bricks and insulation materials, focusing on their preparation methods, material properties, emission reduction capabilities, effectiveness in reducing carbon emissions, enhancing thermal insulation, and promising economic prospects. The major points are: (1) Biochar-based materials offer significant potential for reducing the carbon footprint of buildings and enhancing their thermal insulation properties. (2) With a thermal conductivity ranging from 0.08 to 0.2 W/(m·K), biochar insulation materials contribute to reduced energy consumption and greenhouse gas emissions. (3) Replacing one ton of cement with biochar in brick production can substantially reduce 1351–1505 kg CO₂-eq over the entire life cycle. (4) Using biochar as part of concrete insulation saves about 59–65 kg of carbon dioxide per ton while offering clear economic benefits. Although biochar insulation is comparatively more expensive than traditional insulation materials like fiberglass and foam, its energy-saving advantages can balance the extra cost. (5) Biochar insulation is derived from organic waste, contributing to improved recyclability, environmental sustainability, and cost-effectiveness.