It has been widely accepted that biochar has a great potential of mitigating soil nitrous oxide (N₂O) emission. However, the underlying mechanism about how biochar affects nitrogen transformation and the pathways of soil N₂O production is under discussion. A ¹⁵N-tracer incubation experiment was conducted to investigate the short-term effects of biochar on soil N transformation rates and source partitioning of N₂O emissions in soils from a poplar plantation system. A two-factor experimental design was adopted using biogas digestate slurry and biochar as soil amendments. In total, there were 12 treatments, including three rates of biochar: B0 (control), B2 (80 t ha⁻¹), and B3 (120 t ha⁻¹), and four rates of biogas digestate slurry: C (0 m³ ha⁻¹), L (125 m³ ha⁻¹), M (250 m³ ha⁻¹), and H (375 m³ ha⁻¹). We observed significantly lower rates of net nitrification (N_n) and mineralization (M_n) in biochar-treated soils. The ¹⁵N tracer analysis revealed a significant decrease in gross autotrophic (O_NH4), heterotrophic nitrification (O_Nrec), and mineralization (M_Norg) rates while an increase in gross immobilization (I_NH4 and I_NO3) rates in biochar amended soils. When biogas slurry was applied, biochar only significantly reduced O_NH4 except in the moderate slurry treatment. Regardless of the slurry application, biochar consistently suppressed N₂O emission by 58–89 %, and nitrification was the dominant pathway accounting contributing >90 % to cumulative N₂O emissions. Moreover, soil cumulative N₂O emissions significantly negatively correlated with soil ammonium contents and positively with M_Norg, M_n, and N_n, showing that biochar decreased N₂O emission via a reducing effect on nitrification rates and associated N₂O emissions. Our results also highlight that application of N fertilizer greatly influence the biochar's impacts on soil N transformation rates and N₂O emission, calling for further studies on their interactions to develop mitigate options and to improve N use efficiency.