Subtropical forests are significant contributors to N2O emissions with consequences for climate regulation. Biochar application has emerged as a promising strategy to mitigate soil N2O emissions, yet its effects and the underlying mechanisms under nitrogen (N) deposition in subtropical forests remain poorly understood. A comprehensive 3-year field study within a subtropical forest reveals that N deposition led to a significant increase in soil N2O emissions by 14.6–25.1% annually. However, biochar application resulted in a substantial reduction of these emissions, ranging from 8.0–20.8% each year. Notably, the mitigation effect of biochar was particularly pronounced when N deposition was occurring, leading to an even greater reduction in N2O emissions by 14.2–22.0% annually. This mitigation effect is attributed to biochar’s capacity to lower the nitrification and denitrification rates of soil via reducing levels of ammonium N and water-soluble organic N. Additionally, biochar decreased the abundance of critical microbial genes, including AOAamoA, nirK and nirS, and reduced the activity of key enzymes such as nitrate and nitrite reductase. These findings highlight the potential of straw biochar to effectively mitigate soil N2O emissions in subtropical forests experiencing N deposition, offering important insights for supporting ecosystem sustainability under global climate change.