Observations of salinity and oxygen isotope composition (δ18O) were made for the Beaufort shelf-Mackenzie estuary waters in September 1990, just prior to ice formation, and for both the water column and ice in April–May 1991, at the end of winter. These measurements are used to determine the apportioning of fresh water in the estuary between its two main sources, runoff and sea ice melt. Changes in disposition of water between seasons and amounts frozen into the growing ice sheet are also derived. Two domains are considered in order to construct a freshwater budget for the Mackenzie shelf, the nearshore within which landfast ice grows in winter and the outer shelf. Most of the winter inflow from the Mackenzie River appears to remain impounded as liquid under the ice within the landfast zone at the end of winter, and about 15% of it is incorporated into the landfast ice. Oxygen isotopes (δ18O) in ice cores collected from across the shelf record the progress beneath the ice of new Mackenzie inflow as it invades the nearshore throughout winter. Rates of spreading are about 0.2 cm s−1 away from the coast and 1.3 cm s−1 along the coast. As this inflow spreads across the shelf, it progressively shuts off convection driven by brine production at locations within the landfast ice. Salinity and δ18O in the offshore water column suggest that about 3 m of sea ice was formed in the outer shelf domain. Since both brine and newly formed sea ice can be advected off the shelf, a complete budget for brine or sea ice production cannot be established without first measuring the advection of one of these two components.