Carbon fixation and oxygen release (CFOR) is one of the most important services provided by the forest ecosystem. It is crucial to combine the forest carbon budget with the CFOR service to conduct an accurate assessment of ecosystem service values. Using a forest carbon budget model (CBM-CFS3), this study evaluated both temporal and spatial dynamics of total and net CFOR service values based on estimation of net primary production (NPP) and net ecosystem production (NEP) of the forest ecosystem from 2009 to 2030 in Xingshan county, Hubei province, China. During the simulation period, the total NPP progressively increased from 0.46 Tg/a to 0.70 Tg/a, while the total NEP increased from 0.12 Tg/a to 0.21 Tg/a initially and then declined to 0.18 Tg/a. The total and net CFOR service values ranged from 759 to 1153 million RMB per year and from 221 to 370 million RMB per year, respectively. Heterotrophic respiration (HR) increased progressively with an average annual loss of CFOR value of 729 million RMB per year or 4509 RMB per hectare per year, which accounted for 68.6% of the total CFOR value. The HR loss was highest in the southeastern part of Xingshan, while the net value of CFOR was highest in the central and southwestern parts. The forest ecosystem in Xingshan acted as a carbon sink and provided the CFOR service steadily during the simulation period. Compared with NPP, NEP was more reliable for use in evaluating the value of the CFOR service. A severe overestimation of forest CFOR service value is likely to occur if the impact of HR is excluded. Therefore, to reduce the uncertainty in evaluation and enhance the capacity of ecosystem services assessment, it is necessary to combine the material cycle process with the ecosystem services assessment.