High-water-content dredged clay is a water-rich sediment that requires sustainable, resource-oriented treatment, but conventional ordinary Portland cement (OPC) stabilization is hindered by excessive water-to-binder ratios, suppressed hydration, and high carbon emissions. This study investigated corn straw biochar (CSB) as a partial OPC substitute for the low-carbon stabilization of kaolin-based simulated dredged clay. CSB prepared at 200–1000 °C under different holding times was characterized by water absorption, thermogravimetry, and SEM. Clay specimens with an initial water content of 80% (1.5 w_L) were prepared using 5–12% total binder, CSB:OPC ratios of 5:5–8:2, and curing ages of 7 and 28 d, and were evaluated by UCS, pH, SEM/ESEM, EDS, and life-cycle-based mechanical–environmental assessment. CSB developed honeycomb-like interconnected pores and a lamellar carbon skeleton, reaching 1476.10% water absorption at 700 °C for 30 min. The optimum CSB–OPC specimen reached approximately 136–137 kPa at 28 d, exceeding the OPC-only control of about 102 kPa. Strength improvement was associated with alkalinity maintenance, Ca–Si-rich hydration products, pore filling, and CSB–clay interfacial adsorption, embedding, and encapsulation. Properly carbonized CSB shows potential as an internal-curing, low-carbon co-binder for simulated dredged clay, but its field applicability requires further validation.