Rising atmospheric CO2 concentrations highlight the need for emission reductions; however, it is now widely recognized that emission reductions alone are insufficient and must be complemented by carbon dioxide removal (CDR). Coastal vegetated ecosystems (CVEs), including mangrove forests, salt marshes, and seagrass meadows, are frequently proposed as nature-based CDR solutions because of their high carbon burial rates and long-term sediment storage. Despite occupying more than 100 times less area than terrestrial vegetation, they store carbon efficiently and provide numerous co-benefits, including coastal protection and biodiversity support. However, their global CDR potential remains uncertain due to limited suitable areas for expansion and the lack of representation in Earth System Models (ESMs). To address this gap, we developed a parameterization that enables the representation of CVEs in the coupled Earth System Model FOCI despite their small spatial extent relative to coarse model grids. We applied the parameterization under two future climate pathways and several ecosystem expansion scenarios to evaluate the influence of additional carbon burial by CVEs on the global carbon cycle and climate. Our simulations show that CVE expansion produces only a modest reduction in atmospheric CO2. Even an idealized upper-bound sensitivity test corresponding to a 400% increase in present-day CVE area reduced atmospheric CO2 by only approximately 3–9 ppm by the end of the 21st century, depending on the emissions scenario, while smaller expansion scenarios produced changes that were largely masked by internal climate variability. These results suggest that, although CVEs contribute to climate mitigation and provide valuable local ecosystem services, their potential for global-scale carbon dioxide removal is limited. Consequently, CVE restoration and conservation should primarily be motivated by their multiple ecological and societal benefits, with carbon dioxide removal considered a complementary contribution rather than the primary objective.