Eddy covariance (EC) measurements of net ecosystem CO2 exchange (NEE) were conducted on a boreal sedge fen in southern Finland (61°50′N, 24°12′E) during a 1.5-yr period covering two summers in 2004–2005. The EC data were complemented by chamber measurements, which enabled the partition of the daytime NEE into respiration and photosynthesis. A special emphasis was put on the hydrometeorological responses of CO2 exchange during a drought period in July 2005. A mean CO2 efflux of 0.009 mgCO2 m-2 s-1 was observed during mid-winter (January–February), while the night-time respiration during the two Julys averaged 0.09 mgCO2 m-2 s-1. During both years the mean mid-day uptake in late July was about −0.16 mgCO2 m-2 s-1. An annual CO2 balance of −188 gCO2 m-2 was observed in 2005. A slightly higher net sink of −219 gCO2 m-2 was estimated for 2004. The drought period experienced in July 2005 caused a clear depression in the daily NEE values. From the combined analysis of EC and chamber measurements it was concluded that this was mainly due to increased respiration, but evidence was also found of suppressed photosynthesis due to a high VPD.DOI: 10.1111/j.1600-0889.2007.00309.x