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Streams are integral components of the global carbon cycle, functioning not only as conduits for terrestrial carbon transport to the ocean but also as active sites of carbon transformation, storage, and greenhouse gas (GHG) evasion. Despite their importance, estimates of stream CO₂ and CH₄ emissions remain highly uncertain, particularly in headwater systems where groundwater inputs may represent a dominant yet poorly quantified source.In this study, we quantified the role of groundwater discharge in regulating dissolved carbon dynamics and GHG evasion within an urban headwater stream (Manly Creek, Sydney, Australia). Groundwater discharge zones were identified using radon (²²²Rn) as a natural tracer, and groundwater inflows were quantified using a steady-state radon mass-balance approach. Dissolved CO₂ and CH₄ concentrations were measured in surface water and groundwater to assess groundwater-derived gas inputs and their influence on stream-atmosphere exchange.Groundwater exhibited substantially elevated radon, CO₂, and CH₄ concentrations relative to surface water, confirming strong subsurface accumulation before discharge. A distinct mid-reach groundwater discharge zone was identified, where stream CO₂ and CH₄ concentrations were approximately five-fold and more than two-hundred-fold higher, respectively, than in adjacent surface-water-dominated reaches. Within this groundwater-influenced reach, water–air evasion fluxes ranged from 1037–1959 mmol m⁻² d⁻¹ for CO₂ and 271–511 mmol m⁻² d⁻¹ for CH₄, indicating intense, spatially focused GHG emissions associated with groundwater discharge. Radon mass-balance results showed that advective groundwater inputs overwhelmingly dominated over sediment diffusion and radioactive decay, indicating that groundwater discharge is the primary mechanism sustaining elevated dissolved gas concentrations and evasion fluxes in this reach.By explicitly linking groundwater discharge to localized but disproportionately high stream GHG emissions, this study demonstrates how unresolved groundwater-surface water interactions can lead to systematic underestimation of inland-water emissions in bottom-up carbon budgets. Incorporating such spatially focused groundwater-driven fluxes provides a pathway toward reconciling bottom-up stream emission estimates with top-down atmospheric constraints, thereby improving assessments of inland-water contributions to climate-relevant carbon cycling.