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Tropical peatlands are an important carbon reservoir; however, they are vulnerable to climate change, fire events, and human disturbances, and may become a significant carbon source if degraded. In this paper, we investigated the late Holocene record of vegetation change, peatland evolution, and C accumulation based on analysis of a sediment core through a Mauritia-flexuosa palm dominated swamp (locally called " aguajal ") in the Madre de Dios region in southern Peru to better understand tropical peatland dynamics. Sedimentation commenced within shallow water, ponded on an impervious substrate, perhaps within an abandoned river channel or oxbow lake (1380–820 cal yr BP) located adjacent to a steep escarpment with terra firme (upland) rainforest above and lateral to floodplain forests. This was followed by the development of marsh (820–640 cal yr BP). A closed-canopy Mauritia flexuosa -dominated palm swamp was subsequently established (640300calyr BP) which later changed into an open canopy and mixed Mauritia - Hedyosmum palm swamp (300 cal yr BP to present). Two major changes in peat and C accumulation rates were observed: (1) onset of peat and C accumulation at 820 cal yr BP and (2) decrease of peat and C accumulation after 520 cal yr BP. Comparisons of our results with palaeoecological records from aguajales in northern Peru suggest that the dynamics were different in this region. The peat and C accumulation rates in our study core in southern Peru were ca. 4 mm yr−1 and ca. 200 g m−2 yr−1 faster, similar to a few sites in northern Peru. Aguajales in Madre de Dios region in southern Peru are an important carbon sink. Analyzing the dynamics of aguajales which are a kind of typical peatlands in Amazonia and comparing among different sites allows exploration and prediction of regional peatlands' development under the potential future impact of natural changes. • First study of a palm peatland (aguajal) development in Madre de Dios region, southern Peru • This study includes late Holocene vegetation dynamics, peat and C accumulation of the aguajal • Controlling factors in the dynamics are fluvial changes and climate • Comparisons with northern Peru suggest different vegetation succession • Peat and C accumulation rates in Madre de Dios were faster, similar to a few sites in northern Peru [ABSTRACT FROM AUTHOR]