The olive tree is one of the most important crops in Spain, and the main one in the region of Andalusia. Most orchards are rain-fed, with high slopes where conventional tillage (CT) is the primary soil management system used. These conditions lead to high erosion and a significant transport of organic carbon (OC). Moreover, soil tillage accelerates the oxidation of the OC. Cover crops (CC) are the conservation agriculture (CA) approach for woody crops. They are grown in-between tree rows to protect the soil against water erosion and their organic residues also help to increase the soil carbon (C) sink. Soil and OC losses associated to the sediment were measured over four seasons (2003-07) using micro-plots for the collection of runoff and sediment in five experimental fields located in rain-fed olive orchards in Andalusia. Two soil management systems were followed, CC and CT. Furthermore, the changes in soil C in both systems were analyzed at a depth of 0-25 cm. CC reduced erosion by 80.5%, and also OC transport by 67.7%. In addition, Cover crops increased soil C sink by 12.3 Mg ha-1 year-1 of carbon dioxide (CO2) equivalent, with respect to CT. CC in rainfed olive orchards in a Mediterranean climate could be an environmental friendly and profitable system for reducing erosion and increasing the soil C sink. However, C fixing rate is not regular, being very high for the initial years after shifting from CT to CC and gradually decreasing over time.