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Prefabricated construction is a promising global technology for reducing carbon emissions (CEs) in the construction sector. This study aims to identify critical factors affecting the life cycle of prefabricated buildings, understand their interrelationships, and develop targeted carbon reduction measures. A mixed-methods approach is employed, incorporating bibliometric analysis to identify key factors and the Delphi method to refine these factors through iterative surveys with diverse stakeholders. A 24-member scoring panel and a 3-member review panel consisting of experienced corporate practitioners were selected for the study. The DEMATEL-ISM approach was utilized to analyze causal and hierarchical relationships, revealing both direct and indirect impacts on CEs. The findings indicate that factors such as energy efficiency and behavior change significantly affect CEs in prefabricated buildings. The study categorizes 15 key factors, including energy efficiency, environmental properties, behavioral change, and water and solid waste management. Furthermore, it underscores the importance of building design, energy-saving awareness and habits, and policies and regulations in reducing carbon emissions in prefabricated construction. These insights are valuable for advancing sustainable building research, analyzing stakeholder attitudes, and informing engineering project studies.