Wood charcoal production provides affordable energy in many developing countries and has substantially contributed to the economy through the provision of rural incomes. In several countries, charcoal production leads to overexploitation of forests due to inefficiencies in processing. This study was undertaken in central Laos to (1) examine and document traditional charcoal production systems; (2) investigate the production capacity, recovery efficiencies and economic gains of existing traditional charcoal production methods; (3) characterize the chemical properties of wood charcoal and investigate the potential for soil restoration and (4) investigate local charcoal producers' perception on forest degradation and their species preferences. Through a socio-economic survey, a cost-based method for economic valuation was undertaken on a range of charcoal production methods currently being used. Laboratory chemical analyses were performed on wood charcoal samples. Results indicated that the traditional mud charcoal mound was used by the majority (82%) of charcoal producers. Total charcoal production per production cycle varied between 400 (produced from 2.7 m3 of wood) and 1600 kg (produced from 18 m3 of wood), with a mean of 938 kg (±120) for traditional mud charcoal mounds. The volume of the traditional mud charcoal mounds correlated positively and significantly with total charcoal production (R 2 = 0.45, p?=?0.03), whereas correlated negatively and significantly with the recovery efficiency (R 2 = 0.58, p?=?0.01). On average, the local producers receive a total net benefit of 457,272 Lao kip (USD 57.2) in 17 days. We also identified a rice husk mound method of charcoal production, which may not encourage further deforestation while producing rice husk biochar that can be used for soil restoration. Furthermore, we found that there are significant differences (p < 0.05) between the sampled wood charcoals in chemical properties, indicating that the potential of using wood charcoal for the restoration of degraded soils varies from charcoal to charcoal.