Carbonated smart water (CSMW) injection has drawn considerable interest, especially in the last decade. This interest stems from its results in the recovery factor enhancement and the storage of carbon dioxide. This method has been mainly studied for sandstone formations, and less devotion has been given to carbonates, especially in naturally fractured reservoirs. This paper examines the effect of the CSMW on the recovery factor in carbonate homogenous and fractured reservoirs and investigates the most effective mechanisms. Furthermore, the capability of the CSMW to store the CO2 in the reservoir has been tested. This work has been established based on core flooding experimental data, using a compositional simulator, and extending the core results to a pilot model. The composition and salinity values of the CSMW have been specified using optimization and sensitivity analysis tools. Geochemical reactions and CO2 solubility in the CSMW have been simulated using the PHREEQC. In the core scale, the CSMW showed 14, 7.6, 26.8% more oil recovery than Smart Water (SMW), Carbonated Seawater (CSW), and Seawater (SW), respectively. In the pilot model, CSMW recovered more oil than the SMW by 5–8% based on the heterogeneity and fracture availability. Viscosity reduction is one of the main mechanisms behind the oil recovery increment. More than 30% of viscosity reduction was observed for all studied cases. Ions exchange and mineral dissolution processes were also pivotal. A higher recovery has been obtained in the fractured reservoir after the breakthrough due to the CO2 diffusion from the fractures into the matrices and the spontaneous imbibition process, where those mechanisms need a long time to act effectively. More than 50% of the injected CO2 within the CSMW has been captured in the reservoir’s residual oil and water. It has been concluded that the stored CO2 in the reservoir depends on the amount of residual oil saturation, where the higher the remaining oil in the reservoir, the higher the stored CO2 amount.