A primary goal of developing the CO2 atmospheric measurement network is to better characterize the sources and sinks of atmospheric CO2. Atmospheric transport models can be used to interpret atmospheric measurements in terms of surface fluxes using inverse methodology. In this paper we present a three-dimensional (3-D) inversion of CO2 measurements in order to infer annual sources and sinks of CO2 at a continental scale (continents and ocean basins) for a climatological year representing the 1985--1995 period. Solving this inverse problem requires (1) a data space representing monthly CO2 measurements, here at 77 sites (surface, ships, planes), (2) a flux space describing a priori fluxes between carbon reservoirs, and (3) a 3-D transport model linking the flux space to the data space. Knowledge of these three elements, together with their associated errors, allows one to reduce the uncertainties of the CO2 sources and sinks. In the 1985--1995 period, for our control inversion, the global continental sink is found to be 2.7¿1.5 Gt C yr1 for an optimized deforestation source of 1.4¿0.6 Gt C yr1, yielding a net land uptake of 1.3¿1.6 Gt C yr1 (fossil fuel removed). The continental partition of this budget is (in units of Gt C yr1): Arctic +0.2¿0.3, North America -0.5¿0.6, Europe -0.3¿0.8, north Asia -1.5¿0.7, tropics (except Asia) +0.3¿0.9, tropical Asia +0.8¿0.4, and Southern Hemisphere -0.1¿0.3. The inferred partition for the controversial Northern Hemisphere CO2 sink reveals that a major sink is located over the north Asia continent. For oceans we find a net global sink of 1.5¿0.5 Gt C yr1 with the following partition (in units of Gt C yr1): North Pacific -0.3¿0.2, North Atlantic -0.8¿0.3, equator +0.6¿0.2, 20 ¿S--50 ¿S oceans -0.9¿0.3, and austral ocean -0.1¿0.1. ¿ 1999 American Geophysical Union