We have investigated the possible relationship between defects, carbon bonds and the associated magnetic properties of carbon doped ZnO powders with intentional nominal carbon concentrations of 0, 1, 3, 5, 8 and 10 mol%. The samples were prepared by mechanical milling assisted by solid state reaction and carefully characterized using different techniques. X-ray diffraction and micro-Raman analysis revealed structural changes below and above the nominal carbon doping concentration of 3 mol% along with formation of intrinsic defect complexes. It was found that the oxygen and zinc content and the band gap of ZnO gradually decrease with increasing carbon content. XPS studies revealed the formation of Zn-O-C and O-C-O bonds and partial substitution of oxygen by carbon, in the form of Zn-C in all samples. When the nominal doping concentration increased above 3 mol%, formation of C-Zn-C bonds was drastically increased. The undoped ZnO sample was diamagnetic and free pure graphitic carbon was paramagnetic, while the 3 mol% carbon doped ZnO sample displayed the maximum saturation magnetization. The room temperature ferromagnetism (RTFM) has been ascribed to the presence of Zn-O-C, O-C-O and O-Zn-C bonds, where oxygen atoms may play a crucial role for mediating the long range magnetic interaction. C-Zn-C bonds decrease the saturation magnetization by encouraging antiferromagnetic behavior and the formation of intrinsic defects related with the carbon doping seem to have no influence on the RTFM observed.