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Rapid Arctic warming is causing permafrost to thaw and exposing large quantities of soil organic carbon (C) to potential decomposition. In dry upland tundra systems, subsidence from thawing permafrost can increase surface soil moisture resulting in higher methane (CH₄) emissions from newly waterlogged soils. The proportion of C released as carbon dioxide (CO₂) and CH₄remains uncertain as previously dry landscapes transition to a thawed state, resulting in both wetter and drier microsites. To address how thaw and moisture interact to affect total C emissions, we measured CH₄and CO₂emissions from paired chambers across thaw and moisture gradients created by nine years of experimental soil warming in interior Alaska. Cumulative growing season (May–September) CH₄emissions were elevated at both wetter (216.1–1,099.4 mg CH₄‐C m⁻²) and drier (129.7–392.3 mg CH₄‐C m⁻²) deeply thawed microsites relative to shallow thaw (55.6–215.7 mg CH₄‐C m⁻²) and increased with higher deep soil temperatures and permafrost thaw depth. Interannual variability in CH₄emissions was driven by wet conditions in graminoid‐dominated plots that generated >70% of emissions in a wet year. Shoulder season emissions were equivalent to growing season CH₄emissions rates in the deeply thawed, warmed soils, highlighting the importance of non‐growing season CH₄emissions. Net C sink potential was reduced in deeply thawed wet plots by 4%–42%, and by 3.5%–8% in deeply thawed drier plots due to anaerobic respiration, suggesting that some dry upland tundra landscapes may transition into stronger CH₄sources in a warming Arctic.

Northern circumpolar permafrost thaw affects global carbon cycling, as large amounts of stored soil carbon becomes accessible to microbial breakdown under a warming climate. The magnitude of carbon release is linked to the extent of permafrost thaw, which is locally variable and controlled by soil thermodynamics. Soil thermodynamic properties, such as thermal diffusivity, govern the reactivity of the soil‐atmosphere thermal gradient, and are controlled by soil composition and drainage. In order to project permafrost thaw for an Alaskan tundra experimental site, we used seven years of site data to calibrate a soil thermodynamic model using a data assimilation technique. The model reproduced seasonal and interannual temperature dynamics for shallow (5–40 cm) and deep soil layers (2–4 m), and simulations of seasonal thaw depth closely matched observed data. The model was then used to project permafrost thaw at the site to the year 2100 using climate forcing data for three future climate scenarios (RCP 4.5, 6.0, and 8.5). Minimal permafrost thawing occurred until mean annual air temperatures rose above the freezing point, after which we measured over a 1 m increase in thaw depth for every 1 °C rise in mean annual air temperature. Under no projected warming scenario was permafrost remaining in the upper 3 m of soil by 2100. We demonstrated an effective data assimilation method that optimizes parameterization of a soil thermodynamic model. The sensitivity of local permafrost to climate warming illustrates the vulnerability of sub‐Arctic tundra ecosystems to significant and rapid soil thawing.