Traditional disposal methods such as landfilling and land reclamation are insufficient to mitigate the environmental impact of construction spoil, making non-sintered blocks a promising approach for resource utilization. This study investigates the production and performance of steel slag soil blocks as an alternative to conventional cement-based materials for non-sintered blocks. The optimal manufacturing parameters were identified as a sodium silicate solution with 6% Na2O, 30% steel slag content, a liquid/solid ratio of 0.18, and a forming pressure of 10 MPa, achieving a peak compressive strength of 14.46 MPa. Further, the synergistic combination of alkali activation and carbonation enhanced compressive strength to 17.4 MPa, attributed to the development of a compact microstructure characterized by a honeycomb-like C-(A)-S-H gel and well-crystallized, triangular-shaped aragonite. However, durability tests under freeze-thaw and wet-dry cycles revealed that carbonation can detrimentally affect performance. The transformation of C-(A)-S-H gel into calcium carbonate, with relatively weaker cementitious properties, led to internal cracking and surface detachment. Micro-CT analysis confirmed ring-like patterns under freeze-thaw conditions and diagonal cracks during wet-dry cycling, whereas reference blocks incorporating 30% ordinary Portland cement maintained superior compactness with no cracks. These findings suggest that although the alkali activation and carbonation process enhances early strength, further optimization is necessary to improve long-term durability before broader application can be recommended.