Newly assimilated carbon (C) allocated to soil is the main source of C and energy for microorganisms and has a high impact on long-term C sequestration. The removal of aboveground plant biomass by grazing may increase, decrease or have no effects on belowground C allocation. Therefore, it is important to understand how grazing modifies the allocation of assimilates between above- and belowground. An in situ 13C labeling experiment was carried out in a temperate grassland with three grazing intensities: no grazing, moderate grazing (6 sheep·ha−1) and heavy grazing (9 sheep·ha−1). Eighty-one days after 13C labeling, plants under moderate grazing allocated more recently assimilated C (8.2% of assimilated 13C) to shoots than plants under no grazing and heavy grazing (5.5% each). Substantially more 13C was allocated belowground under moderate grazing, and was mainly stored in roots (11%) and soil (15%), than under no grazing (3.2% in roots and 7.5% in soil) and heavy grazing (4.1% in roots and 6.9% in soil). Moderate and heavy grazing release less 13CO2 (15%) through root and rhizomicrobial respiration than no grazing (19%). Without grazing, the decomposition rate of rhizodeposits and their utilization for root and rhizomicrobial respiration (0.22 ± 0.07 day−1) was much faster than that under grazing (moderate grazing: 0.050 ± 0.01 day−1, heavy grazing: 0.065 ± 0.01 day−1). In summary, moderate grazing increases the stock and stability of newly assimilated C of soil by increasing belowground allocation of photosynthates and decreasing CO2 efflux from soil. Therefore, compared to without and heavy grazing (9 sheep·ha−1), moderate grazing (6 sheep·ha−1) may be more suitable for soil C sequestration in temperate grasslands. © 2022 Elsevier B.V.