Root exudates, labile carbon (C) compounds released by roots, are crucial for plant-microbe interactions and soil organic matter (SOM) formation. Drought alters the quantity and quality of root exudates, impacting soil microbial activity and SOM dynamics. This thesis investigates how drought-induced changes in root exudation influence soil C cycling by subjecting grassland species to drought in a greenhouse, collecting root exudates, and measuring their effects on microbial respiration, microbial activity and community composition, and SOM fractions. The findings show that drought reduced total root exudation but increased specific exudation rates, particularly in forbs and legumes, suggesting that altered root exudation is an adaptive response to stress. Drought-affected exudates enhanced microbial respiration, and this effect was linked to “outsourcing” and “fast” root strategies. These results suggest that root exudation supports microbial-driven SOM nutrient mineralization, providing critical resources for plant survival and linking root traits, such as diameter and nitrogen content, to changes in soil C cycling. Additionally, root exudates from a forb and a legume increased microbial turnover of particulate organic matter and promoted stable mineral-associated organic matter formation, demonstrating a dual role: stabilizing SOM while enhancing microbial activity and nutrient cycling. However, this effect did not persist under repeated drought, indicating limits to root exudation’s role in sustaining ecosystem recovery under repeated stress. This thesis emphasizes the critical role of root exudation in stimulating soil microbial activity and SOM stabilization under drought, providing mechanistic insights into the root exudate-mediated consequences for soil C cycling under global climate change.