The global significance of carbon storage in Indonesia's coastal wetlands was assessed based on published and unpublished measurements of the organic carbon content of living seagrass and mangrove biomass and soil pools. For seagrasses, median above- and below-ground biomass was 0.29 and 1.13 Mg C ha-1 respectively; the median soil pool was 118.1 Mg C ha-1. Combining plant biomass and soil, median carbon storage in an Indonesian seagrass meadow is 119.5 Mg C ha-1. Extrapolated to the estimated total seagrass area of 30,000 km2, the national storage value is 368.5 Tg C. For mangroves, median above- and below-ground biomass was 159.1 and 16.7 Mg C ha-1, respectively; the median soil pool was 774.7 Mg C ha-1. The median carbon storage in an Indonesian mangrove forest is 950.5 Mg C ha-1. Extrapolated to the total estimated mangrove area of 31,894 km2, the national storage value is 3.0 Pg C, a likely underestimate if these habitats sequester carbon at soil depths >1 m and/or sequester inorganic carbon. Together, Indonesia's seagrasses and mangroves conservatively account for 3.4 Pg C, roughly 17 % of the world's blue carbon reservoir. Continued degradation and destruction of these wetlands has important consequences for CO2 emissions and dissolved carbon exchange with adjacent coastal waters. We estimate that roughly 29,040 Gg CO2 (eq.) is returned annually to the atmosphere-ocean pool. This amount is equivalent to about 3.2 % of Indonesia's annual emissions associated with forest and peat land conversion. These results highlight the urgent need for blue carbon and REDD+ projects as a means to stem the decline in wetland area and to mitigate the release of a significant fraction of the world's coastal carbon stores.