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Abstract Climate change is expected to induce shifts in the composition, structure and functioning of Arctic tundra ecosystems. Increases in the frequency and severity of tundra fires have the potential to catalyse vegetation transitions with far‐reaching local, regional and global consequences.We propose that post‐fire tundra recovery, coupled with climate change, may not necessarily lead to pre‐fire conditions. Our hypothesis, based on surveys and literature, suggests two climate–fire driven trajectories. One trajectory results in increased woody vegetation under low fire frequency; the other results in grass dominance under high frequency.Future research should address uncertainties regarding possible tundra ecosystem shifts linked to fires, using methods that encompass greater temporal and spatial scales than previously addressed. More case studies, especially in underrepresented regions and ecosystem types, are essential to broaden the empirical basis for forecasts and potential fire management strategies.Synthesis. Our review synthesises current knowledge on post‐fire vegetation trajectories in Arctic tundra ecosystems, highlighting potential transitions and alternative ecosystem states and their implications. We discuss challenges in defining and predicting these trajectories as well as future directions.