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Abstract This paper presents an empirical model of net ecosystem CO2 exchange (NEE) developed for a subarctic fen near Churchill, Manitoba. The model with observed data helps explain the interannual variability in growing season NEE. Five years of tower-flux data are used to test and examine the seasonal behaviour of the model simulations. Processes controlling the observed interannual variability of CO2 exchange at the fen are examined by exploring the sensitivity of the model to changes in air temperature, precipitation and leaf area index. Results indicate that the sensitivity of NEE to changing environmental controls is complex and varies interannually depending on the initial conditions of the wetland. Changes in air temperature and the timing of precipitation events have a strong influence on NEE, which is largely manifest in gross ecosystem photosynthesis (GEP). Climate change scenarios indicate that warmer air temperatures will increase carbon acquisition during wet years but may act to reduce wetland carbon storage in years that experience a large water deficit early in the growing season. Model simulations for this subarctic sedge fen indicate that carbon acquisition is greatest during wet and warm conditions. This suggests therefore that carbon accumulation was greatest at this subarctic fen during its early developmental stages when hydroclimatic conditions were relatively wet and warm at approximately 2500 years before present. [ABSTRACT FROM AUTHOR]