Peat mosses (Sphagnum) largely govern carbon sequestration in Northern Hemisphere peatlands. We investigated functional traits related to growth and decomposition in Sphagnum species. We tested the importance of environment and phylogeny in driving species traits and investigated trade‐offs among them. We selected 15 globally important Sphagnum species, representing four sections (subgenera) and a range of peatland habitats. We measured rates of photosynthesis and decomposition in standard laboratory conditions as measures of innate growth and decay potential, and related this to realized growth, production, and decomposition in their natural habitats. In general, we found support for a trade‐off between measures of growth and decomposition. However, the relationships are not strong, with r ranging between 0.24 and 0.45 for different measures of growth versus decomposition. Using photosynthetic rate to predict decomposition in standard conditions yielded R² = 0.20. Habitat and section (phylogeny) affected the traits and the trade‐offs. In a wet year, species from sections Cuspidata and Sphagnum had the highest production, but in a dry year, differences among species, sections, and habitats evened out. Cuspidata species in general produced easily decomposable litter, but their decay in the field was hampered, probably due to near‐surface anoxia in their wet habitats. In a principal components analysis, PCA, photosynthetic capacity, production, and laboratory decomposition acted in the same direction. The species were imperfectly clustered according to vegetation type and phylogeny, so that some species clustered with others in the same section, whereas others clustered more clearly with others from similar vegetation types. Our study includes a wider range of species and habitats than previous trait analyses in Sphagnum and shows that while the previously described growth–decay trade‐off exists, it is far from perfect. We therefore suggest that our species‐specific trait measures offer opportunities for improvements of peatland ecosystem models. Innate qualities measured in laboratory conditions translate differently to field responses. Most dramatically, fast‐growing species could only realize their potential in a wet year. The same species decompose fast in laboratory, but their decomposition was more retarded in the field than that of other species. These relationships are crucial for understanding the long‐term dynamics of peatland communities.

• Peatlands in the northern hemisphere have accumulated more atmospheric carbon (C) during the Holocene than any other terrestrial ecosystem, making peatlands long‐term C sinks of global importance. Projected increases in nitrogen (N) deposition and temperature make future accumulation rates uncertain. • Here, we assessed the impact of N deposition on peatland C sequestration potential by investigating the effects of experimental N addition on Sphagnum moss. We employed meta‐regressions to the results of 107 field experiments, accounting for sampling dependence in the data. • We found that high N loading (comprising N application rate, experiment duration, background N deposition) depressed Sphagnum production relative to untreated controls. The interactive effects of presence of competitive vascular plants and high tissue N concentrations indicated intensified biotic interactions and altered nutrient stochiometry as mechanisms underlying the detrimental N effects. Importantly, a higher summer temperature (mean for July) and increasedannual precipitation intensified the negative effects of N. The temperature effect was comparable to an experimental application of almost 4 g N m⁻² yr⁻¹ for each 1°C increase. • Our results indicate that current rates of N deposition in a warmer environment will strongly inhibit C sequestration by Sphagnum‐dominated vegetation.

The relative importance of global versus local environmental factors for growth and thus carbon uptake of the bryophyte genus Sphagnum—the main peat‐former and ecosystem engineer in northern peatlands—remains unclear. We measured length growth and net primary production (NPP) of two abundant Sphagnum species across 99 Holarctic peatlands. We tested the importance of previously proposed abiotic and biotic drivers for peatland carbon uptake (climate, N deposition, water table depth and vascular plant cover) on these two responses. Employing structural equation models (SEMs), we explored both indirect and direct effects of drivers on Sphagnum growth. Variation in growth was large, but similar within and between peatlands. Length growth showed a stronger response to predictors than NPP. Moreover, the smaller and denser Sphagnum fuscum growing on hummocks had weaker responses to climatic variation than the larger and looser Sphagnum magellanicum growing in the wetter conditions. Growth decreased with increasing vascular plant cover within a site. Between sites, precipitation and temperature increased growth for S. magellanicum. The SEMs indicate that indirect effects are important. For example, vascular plant cover increased with a deeper water table, increased nitrogen deposition, precipitation and temperature. These factors also influenced Sphagnum growth indirectly by affecting moss shoot density. Synthesis. Our results imply that in a warmer climate, S. magellanicum will increase length growth as long as precipitation is not reduced, while S. fuscum is more resistant to decreased precipitation, but also less able to take advantage of increased precipitation and temperature. Such species‐specific sensitivity to climate may affect competitive outcomes in a changing environment, and potentially the future carbon sink function of peatlands.

Northern peatlands can emit large amounts of carbon and harmful smoke pollution during a wildfire. Of particular concern are drained and mined peatlands, where management practices destabilize an array of ecohydrological feedbacks, moss traits and peat properties that moderate water and carbon losses in natural peatlands. Our results demonstrate that drained and mined peatlands in Canada and northern Europe can experience catastrophic deep burns (>200 t C ha⁻¹ emitted) under current weather conditions. Furthermore, climate change will cause greater water losses in these peatlands and subject even deeper peat layers to wildfire combustion. However, the rewetting of drained peatlands and the restoration of mined peatlands can effectively lower the risk of these deep burns, especially if a new peat moss layer successfully establishes and raises peat moisture content. We argue that restoration efforts are a necessary measure to mitigate the risk of carbon loss in managed peatlands under climate change.