Sphagnum wetlands are global hotspots for carbon storage, conventionally attributed to the accumulation of decay-resistant litter. However, the buildup of mineral-associated organic carbon (MAOC) with relatively slow turnover has rarely been examined therein. Here, employing both large-scale comparisons across major terrestrial ecosystems and soil survey along Sphagnum gradients in distinct wetlands, we show that Sphagnum fosters a notable accumulation of metal-bound organic carbon (OC) via activating iron and aluminum (hydr)oxides in the soil. The unique phenolic and acidic metabolites of Sphagnum further strengthen metal-organic associations, leading to the dominance of metal-bound OC in soil MAOC. Importantly, in contrast with limited MAOC sequestration potentials elsewhere, MAOC increases linearly with soil OC accrual without signs of saturation in Sphagnum wetlands. These findings collectively demonstrate that Sphagnum acts as an efficient ‘rust engineer’ that largely boosts the rusty carbon sink in wetlands, potentially increasing long-term soil carbon sequestration.