Arctic and subarctic regions are predicted to experience a more rapid temperature increase than the global average, and large amounts of carbon in the soil will then be released back to the atmosphere when the soil thaws. With this predicted warming future, the emissions of greenhouse gases, especially methane, from the northern latitudes could contribute significantly to increased global climate change. Hydrological conditions play crucial roles by affecting ecosystem functioning, influencing vegetation distributions as well as soil biogeochemical processes. In this project, we aim to quantify hydrological impacts on the carbon balance (sinks/sources) at catchment level for observational periods, and further predict the changed hydrological conditions and their consequences on ecosystem functioning in a warming future. The study area is located in northern Sweden, north of the Arctic Circle. To accomplish this aim of the project we have chosen a widely-used dynamic ecosystem model, LPJ-GUESS, as the platform to investigate soil-water-plant interactions. Moreover, a newly-developed water flow algorithm is integrated to enhance water flow simulations. The project has been conducted extensively among hydrological and ecosystem modelling groups at the Department of Physical Geography and Ecosystem Sciences as well as the GIS Centre. Comprehensive hydrological and carbon measurements in the field also enable thorough evaluations of the modelled outcomes in this project.