Understanding the mechanisms that drive chimeric antigen receptor (CAR) T cell function and persistence in multiple myeloma (MM) remains a critical challenge for improving therapeutic outcomes. In this study, we applied single-cell multiomics and gene regulatory network (GRN) analysis to characterize the transcriptional dynamics and clonal evolution of BCMA-targeted CAR T cells in longitudinally collected bone marrow (BM) and peripheral blood (PB) samples from MM patients. Our results revealed that CAR T cells infiltrating BM exhibited a more activated and exhausted phenotype compared to their PB counterparts, with key transcriptional regulators driving these changes. Dysregulation in the effector-to-memory transition led to an increased presence of terminally differentiated CAR T cells, correlating with poor persistence. Additionally, we identified a hyperexpanded CAR T clone in the BM of a patient with partial response, marked by elevated IL10 expression. Functional analyses demonstrated that stimulation of endogenous TCR enhanced IL10 production, potentially contributing to impaired CAR T cell proliferation and persistence. These findings uncover critical regulatory mechanisms influencing CAR T cell dynamics, offering new insights into improving CAR T cell persistence and therapeutic efficacy in MM and highlights potential molecular targets for optimizing CAR T cell therapy in patients with MM.