Arctic landscape dynamics are thought to be a direct indicator of global change. The degradation of ice-rich permafrost since the Pleistocene-Holocene transition is believed to be responsible for the formation of numerous thermokarst lakes. However, these lakes typically undergo a cycle of initiation, expansion, drainage, and re-initiation that may or may not be coupled to global change. Our study of a recently drained lake basin in Arctic Alaska (USA) provides insights into past landscape dynamics in the continuous permafrost region. We applied a multi-proxy approach on a sediment core using bioindicators, as well as sedimentological and biogeochemical methods. Our investigation demonstrates that lake development in the permafrost-affected terrestrial Arctic can be triggered but also interrupted by global climate change (e.g. rapid warming and wetting in the Early Holocene), regional environmental dynamics (e.g. nearby volcanic eruptions and tephra deposition) or local disturbance processes (e.g. lake drainage). The present study emphasizes that Arctic lake systems and periglacial landscapes are dynamic and sensitive to rapid change – in the past, present and most certainly in the future.