Aquatic vegetation loss caused substantial decrease of ecosystem processes and services during the last decades, particularly for the capacity of these ecosystems to sequester and store carbon from the atmosphere. This study investigated the extent of aquatic emergent vegetation loss for the period 1985–2018 and the consequent effects on carbon sequestration and storage capacity of Valle Santa wetland, a protected freshwater wetland dominated by Phragmites australis located in the Po river delta Park (Northern Italy), as a function of primary productivity and biomass decomposition, assessed by means of satellite images and experimental measures. The results showed an extended loss of aquatic vegetated habitats during the considered period, with 1989 being the year with higher productivity. The mean breakdown rates of P. australis were 0.00532 d−1 and 0.00228 d−1 for leaf and stem carbon content, respectively, leading to a predicted annual decomposition of 64.6% of the total biomass carbon. For 2018 the carbon sequestration capacity was estimated equal to 0.249 kg C m−2 yr−1, while the carbon storage of the whole wetland was 1.75 × 103 t C (0.70 kg C m−2). Nonetheless, despite the protection efforts over time, the vegetation loss occurred during the last decades significantly decreased carbon sequestration and storage by 51.6%, when comparing 2018 and 1989. No statistically significant effects were found for water descriptors. This study demonstrated that P. australis-dominated wetlands support important ecosystem processes and should be regarded as an important carbon sink under an ecosystem services perspective, with the aim to maximize their capacity to mitigate climate change.