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Losses of C from decomposing permafrost may be offset by increased productivity of tundra plants, but nitrogen availability partially limits plant growth in tundra ecosystems. In this soil incubation experiment carbon (C) and nitrogen (N) cycling dynamics were examined from the soil surface down through upper permafrost. We found that losses of CO₂ were negatively correlated to net N mineralization because C‐rich surface soils mineralized little N, while deep soils had low rates of C respiration but high rates of net N mineralization. Permafrost soils released a large flush of inorganic N when initially thawed. Depth‐specific rates of N mineralization from the incubation were combined with thaw depths and soil temperatures from a nearby manipulative warming experiment to simulate the potential magnitude, timing, and depth of inorganic N release during the process of permafrost thaw. Our calculations show that …