Changes in arctic C stocks with climate are thought to be caused by rising net primary productivity (NPP) during longer and warmer growing seasons, offset by rising heterotrophic respiration (Rh) in warmer and deeper soil active layers. In this study, we used the process model ecosys to test hypotheses for these changes with CO2 and energy fluxes measured by eddy covariance over a mesic shrub tundra at Daring Lake, Canada, under varying growing seasons. These tests corroborated substantial rises in NPP, smaller rises in Rh, and, hence, rises in net ecosystem productivity (NEP) from 17 to 45 g C m−2 yr−1 (net C sink), modeled with higher Ta and longer growing seasons. However, NEP was found to decline briefly during midsummer warming events (Ta > 20°C). A model run under climate change predicted for Daring Lake indicated that rises in NPP would exceed those in Rh during the first 100 years, causing NEP to rise. Rises in NPP were driven by more rapid net N mineralization from more rapid Rh in warming soils. However, greater declines in NEP were modeled during more frequent and intense midsummer warming events as climate change progressed. Consequently, average annual NEP (± interannual variability) rose from 30 (±13) g C m−2 yr−1 under current climate to 57 (±40) g C m−2 yr−1 after 90 years but declined to 44 (±51) g C m−2 yr−1 after 150 years, indicating that gains in tundra NEP under climate change may not be indefinite.