Arctic warming is outpacing the global rate of climate change, with up to 11 degrees C of warming projected by the year 2100 if greenhouse gas emissions follow their current trajectories. Increasing temperatures are expected to result in permafrost thaw, and the combined effects of precipitation changes, soil warming, and active layer deepening are expected to result in net soil drying. While there is widespread agreement that increasing temperatures and active layer depth will release carbon from soils, the effect on vegetative C cycling is less certain. In 2017, we conducted an experiment to examine the effects of soil drying and active layer deepening on primary productivity in Eriophorum vaginatum, a dominant circumpolar Arctic sedge, and the extent to which those effects vary across ecotypes. We harvested E. vaginatum tussocks from three sites along a latitudinal gradient in the Alaskan Arctic, placed them in pots filled with peat soil, and assigned each to one of three drying treatments. In one treatment, the soils were kept saturated with water through the growing season. In the second treatment, rain was excluded in alternating two-week cycles. In the third treatment, rain was also excluded in alternating two-week cycles, and the soil column was approximately doubled in depth to allow deeper drainage. We measured soil moisture, leaf water potential, leaf area index (LAI), leaf-level phenology, and photosynthetic capacity (Amax) in each of the tussocks. We found that the southern ecotype was affected most severely by drying, with reductions in LAI, maximum leaf length, and Amax. We found that effects were greater with rain exclusion and soil column deepening than with rain exclusion alone. However, we found no difference in leaf water potential between populations or treatments, suggesting that E. vaginatum leaves function within a fairly narrow range of moisture conditions. These results demonstrate that changes in soil moisture may affect carbon storage in Arctic vegetation, but that the magnitude of the effect may vary depending on region and ecotype.