Climatic warming presents an imposing problem to scientists everywhere. Its effect in the Arctic is accentuated for several reasons. The temperature increase is expected to be greatest in the higher latitudes and the ramifications of the warming may be more crucial there due to the melting of permafrost. Precipitation changes will likely accompany climatic warming in the Arctic, compounding the effect of a temperature increase. The interaction of changing hydrologic and thermal processes presents a complex problem which would be difficult if not impossible to analyze without the use of detailed computer modeling. To analyze the thermal impact of climatic warming on a permafrost environment, TDHC, a heat conduction model which incorporates phase change, was used. Then the response of the active layer to climatic warming was incorporated into HBV, a hydrologic model, to elucidate the effects on the hydrologic regime. Several scenarios of climatic warming have been examined to determine the impact on the active layer depth, but only results of 4 ¿C warming at a typical arctic site will be presented here. In the case of 4 ¿C warming, three scenarios of precipitation were studied: no change, +15%, and -15%. The most obvious and perhaps significant response to climatic warming was an increase in active layer depth. Other changes worth noting were warming of the entire soil profile, increased soil moisture storage, increased evaporation, and variable response in runoff, depending upon the scenario. Evaporation now vies with runoff as the primary loss of moisture from the watershed. If evaporation increases due to a warmer climate, the entire character of arctic hydrology could change, depending on changes in precipitation. ¿ American Geophysical Union 1991