Ground thawing and soil warming are governed by ground heat flux, soil thermal properties and the ice content of the soil, all of which are directly or indirectly influenced by the soil moisture status. Ground temperature and moisture were measured at two Arctic sites: a wetland site of frequent saturation and an adjacent pebbly loam site which was much drier. Both thermal conductivity and heat capacity were strongly affected by the ice and water contents. At both sites, about half of the ground heat flux was consumed by latent heat for ground thawing and a large fraction of heat was also conducted from the seasonally thawed zone into the permafrost, leaving only a small amount of heat to warm the active layer. The wetland soil had a shallower maximum depth of thaw than the drier site and this was due to the large ice content in its active layer. Our results demonstrate the ground thaw response to the thermal properties of the soil and its ice content, both of which are influenced by the hydrological conditions of the active layer.