Low volumetric sweep efficiency, early breakthrough of injected fluid, and high risk of gas leakage from the reservoir are the major technical challenges associated with direct gas and water injection into oil reservoirs. Injection of carbonated water (CW) into oil reservoirs is a carbon dioxide-augmented water injection technique, which results in improved oil recovery and possible CO2 storage in the reservoir. In this paper, the potential of carbonated water injection (CWI) into an Iranian carbonate reservoir for the purpose of improving oil recovery was investigated. In addition, the interfacial tension (IFT) of crude oil and two different carbonated brines (carbonated formation brine and carbonated seawater) as well as CO2 solubility in these two carbonated brines was determined. Experimental results showed that CO2 solubility in both brines increases with pressure and decreases with temperature. However, CO2 solubility was more promising in seawater compared to formation brine because of the lower salinity. The IFT results showed that increasing the temperature from 40 to 100 °C and increasing the pressure from 1000 to 2500 psi had a positive impact on reducing the IFT between carbonated brines and oil. In addition, core flooding experiments showed that oil recovery increased with CWI as compared to conventional water flooding (WF). However, secondary carbonated water injection (SCWI) resulted in higher oil recovery compared to tertiary carbonated water injection (TCWI). A maximum oil recovery of 21.75%, 61.63%, and 52.58% was achieved with conventional WF, SCWI, and TCWI, respectively.