Mangrove forests are among the most productive ecosystems in the world. These tropical and subtropical coastal forests provide a wide array of ecosystem services, including the ability to sequester and store large amounts of ‘blue carbon.’ Given rising concerns over anthropogenic carbon dioxide (CO2) emissions, mangrove forests have been increasingly recognized for their potential in climate change mitigation programs. However, their productivity differs considerably across environments, making it difficult to estimate carbon sequestration potentials at regional scales. In addition, most research has focused in humid and tropical latitudes, with limited studies in arid regions. The objectives of this study were to determine the average net ecosystem exchange (NEE) and annual carbon budget as well as to determine the meteorological variables that drive carbon flux on a diel and seasonal scale for a subtropical arid mangrove ecosystem in Magdalena Bay, Baja California Sur (BCS), Mexico. Measurements were taken between 2012-2013 and NEE was quantified using the eddy covariance technique and a neural network with a daily mean of -2.25 ±0.4 g C m-2 d-1 and annual carbon uptake of 866 g C m-2 y-1. Daily variations in NEE were found to be primarily regulated by solar radiation (as evaluated by photosynthetically active radiation (PAR). Air temperature and vapor pressure deficit were had the strongest influence on seasonal variation in fluxes. The mangrove forest in Magdalena Bay studied here was a sink for atmospheric CO2 during the 2012-2013 study period. Despite the harsh and arid climate of this region, these mangroves were nearly as productive as mangroves found in tropical and subtropical climates around the world. These results suggest that mangrove ecosystems in arid regions can be an important part in regional climate change mitigation programs and as one of the largest mangrove ecosystems in the Baja California peninsula, our results broaden understanding of the many ecosystem services these coastal forests provide, including their potential role in carbon budget mitigation plans for the Baja California Sur coastal region.