Aim Persistent sinks of atmospheric CO2 in undisturbed peatlands are not included in future projections of the global carbon budget. We aimed to explore possible responses of northern peatlands to future climate change and to quantify the role of northern peatlands in the carbon balance of the Northern Hemisphere. Location The terrestrial Northern Hemisphere (>30° N). Time period 1861–2099. Major taxa studied Not a specific plant species, but a plant functional type is used by the model to represent an average of all vegetation growing in northern peatlands. Methods The ORCHIDEE‐PEAT v.2.0 process‐based land surface model was used to simulate area and carbon dynamics of northern peatlands. The model was driven up to the year 2099 by the global CO2 concentration from representative concentration pathways (RCPs) 2.6, 6.0 and 8.5 by corresponding climate projections from two general circulation models after bias correction. Results First, from 1861 to 2005 the mean annual carbon balance of northern peatlands was an atmospheric CO2 sink of 0.10 PgC/year, and this sink will roughly double in the future under both RCP2.6 and RCP6.0, whereas the total northern peatlands will be either a source of CO2 (IPSL‐CM5A‐LR) or near neutral (GFDL‐ESM2M) by the end of the century under RCP8.5. Second, the peatlands in western Canada, western and northern Europe may experience reducing areas and may shift from being CO2 sinks to sources, especially under rapid climate warming. Third, peatland enhances soil carbon accumulation in the Northern Hemisphere (lands north of 30° N). Main conclusions In this study, future changes in both northern peatland extent and peatland carbon storage are simulated. We highlight that undisturbed northern peatlands are small but persistent carbon sinks in the future; thus, it is important to protect these ecosystems.