The growth of urban populations, industrial expansion and rising levels of waste generation have created serious environmental pressure in many developing countries. Municipal waste, agricultural residues, forestry by-products, sewage sludge and food waste accumulate in landfills, open dumping sites and waterways. These practices increase greenhouse gas emissions, contaminate water bodies and reduce land quality, at the same time many developing nations face soil degradation, declining agricultural productivity and limited access to water treatment technologies. Biochar production presents a practical approach that addresses these challenges while supporting the transition toward a circular economy. This study examines the environmental potential of biochar within circular economy systems in developing countries with attention to production methods, process conditions, applications and the role of digital technologies in improving adoption. Biochar production from agricultural residues reduce waste volumes by > 60% while stabilizing carbon for long periods in soil. Biochar application increase soil water retention by up to 30% and improve crop yields between 10-40% depending on soil conditions and crop type. Biochar has strong adsorption capacity for pollutants in wastewater treatment with removal efficiencies above 70%. From a climate perspective each ton of biochar added to soil can store between 2 - 3 tons of carbon dioxide equivalent. These outcomes highlight the environmental value of biochar when waste resources are valorized. The study evaluates biochar applications in wastewater treatment, agriculture, climate mitigation, carbon storage and emerging uses in energy materials. The Internet of Things (IoT), Geographic Information Systems (GIS) and Artificial Intelligence (AI) are examined as emerging technologies that support optimization of biochar systems. The analysis shows that integrating biochar production with circular economy strategies reduce waste streams, improve soil health, enhance water quality and support sustainable development in developing countries.