Using a 50-year-old field experiment, we investigated the effects of the long-term land management practices of repeated burning and grazing on peatland vegetation and carbon dynamics (C). Plant community composition, C stocks in soils and vegetation, and C fluxes of CO2, CH4 and DOC, were measured over an 18-month period. We found that both burning and grazing reduced aboveground C stocks, and that burning reduced C stocks in the surface peat. Both burning and grazing strongly affected vegetation community composition, causing an increase in graminoids and a decrease in ericoid subshrubs and bryophytes relative to unburned and ungrazed controls; this effect was especially pronounced in burned treatments. Soil microbial properties were unaffected by grazing and showed minor responses to burning, in that the C:N ratio of the microbial biomass increased in burned relative to unburned treatments. Increases in the gross ecosystem CO2 fluxes of respiration and photosynthesis were observed in burned and grazed treatments relative to controls. Here, the greatest effects were seen in the burning treatment, where the mean increase in gross fluxes over the experimental period was greater than 40%. Increases in gross CO2 fluxes were greatest during the summer months, suggesting an interactive effect of land use and climate on ecosystem C cycling. Collectively, our results indicate that long-term management of peatland has marked effects on ecosystem C dynamics and CO2 flux, which are primarily related to changes in vegetation community structure. © 2007 Springer Science+Business Media, LLC.