Abundant (6 to 9 wt %) graphite has been found in the serpentinized regions of olivine grains from several kimberlites. If the graphite originally was dissolved as atomic carbon in high-pressure olivine, this factor must affect petrologic models of mantle melting in the presence of CO2. On the other hand, if the carbon originally existed as CO2-filled fluid inclusions in olivine grains or was introduced during serpentinization, the development of graphite provides fo2 constraints on kimberlite serpentinization. There is evidence for all three mechanisms of graphite formation. However, it appears most likely that graphite developed during reduction of serpentinizing fluids (probably methane-bearing).