We analysed gross primary productivity (GPP), total ecosystem respiration (TER) and the resulting net ecosystem exchange (NEE) of carbon dioxide (CO2) by the terrestrial biosphere during the summer of 2018 through observed changes across the Integrated Carbon Observation System (ICOS) network, through biosphere and inverse modelling, and through remote sensing. Highly correlated yet independently-derived reductions in productivity from sun-induced fluorescence, vegetative near-infrared reflectance, and GPP simulated by the Simple Biosphere model version 4 (SiB4) suggest a 130–340 TgC GPP reduction in July–August–September (JAS) of 2018. This occurs over an area of 1.6 × 106km2with anomalously low precipitation in northwestern and central Europe. In this drought-affected area, reduced GPP, TER, NEE and soil moisture at ICOS ecosystem sites are reproduced satisfactorily by the SiB4 model. We found that, in contrast to the preceding 5 years, low soil moisture is the main stress factor across the affected area. SiB4’s NEE reduction by 57 TgC for JAS coincides with anomalously high atmospheric CO2observations in 2018, and this is closely matched by the NEE anomaly derived by CarbonTracker Europe (52 to 83 TgC). Increased NEE during the spring (May–June) of 2018 (SiB4 −52 TgC; CTE −46 to −55 TgC) largely offset this loss, as ecosystems took advantage of favourable growth conditions.This article is part of the theme issue ‘Impacts of the 2018 severe drought and heatwave in Europe: from site to continental scale’.