Global land cover dynamics alter energy, water, and greenhouse gas exchange between land and atmosphere, affecting local to global weather and climate change. Although reforestation can provide localized cooling, ongoing land use land cover (LULC) shifts are expected to exacerbate urban heat island impacts. In this study, we monitored spatiotemporal changes in green cover in response to land use transformation associated with the Khyber Pakhtunkhwa (KPK) provincial government’s Billion Tree Tsunami Project (BTTP) and the Ravi Urban Development Plan (RUDP) initiated by the provincial government of Punjab, both in Pakistan. The land change modeler (LCM) was used to assess the land cover changes and transformations between 2000 and 2020 across Punjab and KPK. Furthermore, a curve fit linear regression model (CFLRM) and sensitivity analysis were employed to analyze the impacts of land cover dynamics on land surface temperature (LST) and carbon emissions (CE). Results indicated a significant increase in green fraction of +5.35% under the BTTP, achieved by utilizing the bare land with an effective transition of 4375.87 km2. However, across the Punjab province, an alarming reduction in green fraction cover by −1.77% and increase in artificial surfaces by +1.26% was noted. A significant decrease in mean monthly LST by −4.3 °C was noted in response to the BTTP policy, while an increase of 5.3 °C was observed associated with the RUDP. A substantial increase in LST by 0.17 °C was observed associated with transformation of vegetation to artificial surfaces. An effective decrease in LST by −0.21 °C was observed over the opposite transition. Furthermore, sensitivity analysis suggested that LST fluctuations are affecting the % of CO2 emission. The current findings can assist policymakers in revisiting their policies to promote ecological conservation and sustainability in urban planning.