Gypsum board is a material used in construction due to its numerous qualities and functional properties, such as: low density, fire resistance, thermal insulation, moisture control, decorative appearance, etc. From an environmental point of view, the production of one tonne of gypsum board causes about 355 kg of CO2 emissions into the atmosphere. The aim of this study is to reduce this CO2 footprint while improving the mechanical and thermal properties of gypsum board. Flax fibres with a length of 12 mm, 24 mm and 36 mm were used to replace gypsum in the volume fraction. The addition of 10% flax fibres neutralises the carbon footprint of the gypsum board. However, due to the possible formation of fibre strands during mixing, which may affect the mechanical strength, the addition of flax fibres is limited to 1, 2 and 3%. An improvement in flexural strength was observed in the fibre-reinforced composites. The fibres changed the mechanical behaviour, e.g., toughness, compared to unreinforced gypsum. In addition to the improvement in mechanical properties, the addition of the fibres lowered the thermal conductivity value of the reinforced composites, resulting in improved thermal insulation.