Artificial upwelling (AU) is a marine engineering technology with the potential to enhance biomass production and carbon uptake. However, the trade-off between its environmental costs and benefits remains poorly understood. Using an AU-coupled kelp cultivation demonstration project in Aoshan Bay, China, as a case study, this study integrated life cycle assessment, ecological efficiency assessment, and environmental value assessment to evaluate its environmental sustainability. Over a 10-year assessment period, the project generated 728.7 t CO₂-eq of global warming potential, 5.27 t SO₂-eq of acidification potential, and 1.51 t PO₄-eq of eutrophication potential. Steel production, fishing-vessel diesel combustion, and polyester fiber production were identified as the dominant environmental hotspots. Although AU substantially enhanced kelp production and carbon uptake, the carbon return ratio was only 0.112 and the carbon payback period reached 89.3 years, indicating that net-negative carbon operation has not yet been achieved. Under the baseline scenario, the environmental benefit–cost ratio reached 2.38, demonstrating that the project's monetized ecological benefits exceeded its life-cycle environmental costs. Benefit composition analysis further showed that environmental value was driven primarily by increased kelp production rather than carbon-related benefits. Overall, although AU has yet to deliver substantial net-negative carbon benefits, it already exhibits considerable environmental deployment value. This study provides a framework for evaluating the environmental sustainability of marine ecological engineering projects and informs the development of marine carbon dioxide removal technologies and sustainable marine ranching systems.