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The ranges of black and white spruce are largely sympatric, suggesting both species have similar climate requirements. The two species, however, are highly segregated across the landscape with black spruce most common on nutrient‐poor sites with cold, poorly drained soils and white spruce more common on productive sites with warmer, well‐drained soils. Because site conditions influence tree climate–growth responses, it is difficult to compare white and black spruce climate–growth responses as these responses are confounded by the differences in site conditions in which the two species naturally occur. As the climate warms dramatically in northern latitudes, it is critical to understand how a changing climate and associated changes in permafrost and fire regimes will interact to shape future species composition and ecosystem functioning in the boreal forest. In this study, we examined the climate–growth responses of black and white spruce growing in the same sites. This approach eliminates the confounding factor of site conditions and facilitates our understanding of how these two species respond to climate. We included standardized thaw depth of the active layer in our analysis as a representation of permafrost, which is a key factor delineating these two species' habitat preferences and is actively warming and thawing as the climate warms. Our most important finding was that the climate–growth responses of the two species, but especially white spruce, hinged on the thaw depth of the active layer. Specifically, with increasing June–July temperatures white spruce radial growth increased in areas with deep thaw or no near‐surface permafrost, but strongly decreased when growing in areas with near‐surface permafrost. Black spruce radial growth was less sensitive to June–July temperature than white spruce but had a consistent and more positive response to summer precipitation. These findings point to a primary mechanism potentially driving the positioning of these two tree species within the landscapes of boreal interior Alaska and imply widespread thawing of permafrost may foster expansion of white spruce in this region at the expense of black spruce, but that in a wetter climate, black spruce may gain competitive advantage over white spruce in some landscape positions. [ABSTRACT FROM AUTHOR]