We incorporated peatland dynamics into Arctic version of dynamic vegetation model LPJ-GUESS to understand the long-term evolution of northern peatlands and effects of climate change on peatland carbon balance. We found that the Stordalen mire may be expected to sequester more carbon before 2050 due to milder and wetter climate conditions, a longer growing season and CO₂ fertilization effect, turning into a C source after 2050 because of higher decomposition rates in response to warming soils.