Summary The response of vegetation to climate change has implications for the carbon cycle and global climate. It is frequently assumed that a species responds uniformly across its range to climate change. However, ecotypes − locally adapted populations within a species − display differences in traits that may affect their gross primary productivity (GPP) and response to climate change. To determine if ecotypes are important for understanding the response of ecosystem productivity to climate we measured and modeled growing season GPP in reciprocally transplanted and experimentally warmed ecotypes of the abundant Arctic sedge Eriophorum vaginatum. Transplanted northern ecotypes displayed home‐site advantage in GPP that was associated with differences in leaf area index. Southern ecotypes exhibited a greater response in GPP when transplanted. The results demonstrate that ecotypic differentiation can impact the morphology and function of vegetation with implications for carbon cycling. Moreover they suggest that ecotypic control of GPP may limit the response of ecosystem productivity to climate change. This investigation shows that ecotypes play a substantial role in determining GPP and its response to climate. These results have implications for understanding annual to decadal carbon cycling where ecotypes could influence ecosystem function and vegetation feedbacks to climate change.