He was the son of Baron Karl Matthias Oskar von Buxhoeveden (1822–1884). He was a Baltic German nobleman, a captain lieutenant (Kapitänleutnant) in the Imperial Russian Navy, and a regional politician and his wife Baroness Sophie Juliane von Tiesenhausen (1835–1911), who belonged to another prominent and ancient Baltic German noble family.

He was born in Dorpat (now Tartu, Estonia) into a prominent Baltic German noble family. He grew up to become a high-ranking diplomat and Master of the Horse (Hofstallmeister) at the court of the Russian Tsar. He is also widely remembered as the father of Baroness Sophie von Buxhoeveden, the loyal lady-in-waiting to Empress Alexandra Feodorovna.

Through his parents, Karlos was part of the distinguished House of Magnusdahl branch of the Buxhoeveden family line.

He married Lyudmila Osokina and they had three children:

Baroness Sophie "Isa" Buxhoeveden (1883–1956): Their eldest child and only daughter to reach adulthood. She became a highly trusted and loyal personal lady-in-waiting to Russia's last Empress, Alexandra Feodorovna. She famously survived the Russian Revolution, escaped through Siberia, and later wrote definitive memoirs about the final days of the Romanov family. 

Baron Peter von Buxhoeveden (1886–1909): Their only son. He served as an imperial naval officer and fought bravely aboard the cruiser Oleg during the historic Battle of Tsushima in 1905, where he was severely wounded. Struggling with the aftermath of his heavy wartime injuries, he tragically took his own life a few years later in Helsinki at the age of 22.

Baroness Maria von Buxhoeveden (1892–1893): Their youngest child, who passed away in infancy when she was only about a year old.

He survived his wife, who died just before the revolution, and died in Brussels in 1935.