The CO2 dynamics were measured in an organic soil in eastern Finland during the growing season and wintertime, and the annual CO2 balance was calculated for plots where barley or grass was grown. During the summer, the CO2 dynamics were measured by transparent and opaque chambers using a portable infrared gas analyser for the CO2 analyses. During the winter, the CO2 release was measured by opaque chambers analysing the samples in the laboratory with a gas chromatograph. Statistical response functions for CO2 dynamics were constructed to evaluate the annual CO2 exchange from the climatic data. The net CO2 exchange was calculated for every hour in the snow-free season. The carbon balance varied extensively depending on the weather conditions, and type and phenology of vegetation. During the growing season, the grassland was a net source while the barley field was a net sink for CO2. However, both soils were net sources for CO2 when autumn, winter and spring were included also. The annual CO2 emissions from the grassland and barley soil were 750 g CO2-C m−2 and 400 g CO2-C m−2, respectively. The carbon accumulated in root and shoot biomass during the growing season was 330 g m−2 for grass and 520 g m−2 for barley. The C in the aboveground plant biomass ranged from 43 to 47% of the carbon fixed in photosynthesis (PG) and the proportion of C in the root biomass was 10% of the carbon fixed in photosynthesis. The bare soils had 10–60% higher net CO2 emission than the vegetated soils. These results indicate that the carbon balance of organic soils is affected by the characteristics of the prevailing plant cover. The dry summer of 1997 may have limited the growth of grass in the late summer thus reducing photosynthesis, which could be one reason for the high CO2 release from this grass field.