Regulations such as the Kyoto Protocol aim to limit worldwide net carbon emissions and could be quite costly for Annex 1 countries. “Carbon trading” could reduce the costs of restricting emissions and has been included in Clean Development Mechanism (CDM) proposals as one part of the implementation of the Kyoto Protocol. A carbon “baseline” (what would emissions be without any policy) is crucial in defining how much carbon trading should be allowed. Estimated forest-and-carbon baselines exist but major uncertainties remain about the relevant and appropriate estimation of baselines. We discuss what has been tried in the past, focusing upon land-use baselines (specifically deforestation paths). We consider challenges for small-scale sequestration project baselines and for larger-scale, regional/national carbon projections. Within the latter we highlight research from our team’s integrated project on Costa Rican forests.