Skottsberg was born in Karlshamn on 1 December 1880 the son of Carl Adolf Skottsberg a schoolmaster and his wife, Maria Louisa Pfeiffer.
He was educated locally then studied Sciences at Uppsala University from 1898, specialising in Botany, and receiving his doctorate (PhD) there in 1907.
From 1901 to 1903 Skottsberg served as official botanist to the Swedish Antarctic Expedition of 1901 to 1903 on the ship Antarctic. On his return to Sweden, Skottsberg published (1905) the first comprehensive phytogeographic study of the flora of southern Patagonia and Tierra del Fuego. Later he led the Swedish Magellanic Expedition to Patagonia, 1907 to 1909. Carl Skottsberg is believed to have been the last to have seen the Santalum fernandezianum tree alive when he visited the Juan Fernández Islands in 1908.
He was conservator at the Uppsala University Botanical Museum 1909 to 1914, but led the work on the new Botanical Garden in Gothenburg from 1915, and was appointed professor and director of the garden there, Göteborg Botanical Garden, in 1919.
Skottsberg was a member of the Royal Swedish Academy of Sciences and several other Swedish learned societies, and was elected a Fellow of the Royal Society in 1950. That same year he presided the 7th International Botanical Congress. He was awarded the Linnean Society of London's Darwin-Wallace Medal in 1958 and the Linnean Medal in 1959.
He is buried at Östra kyrkogården in Gothenburg.