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Reed ( Phragmites australis ) dominated wetlands are commonly known as strong carbon (C) sinks due to the high productivity of the reed plant and C fixation in the wetland soil. However, little is known about the effects of drought on reed-dominated wetlands and the possibility of Pannonian reed ecosystems being a source of greenhouse gases (GHG). The drought at Lake Neusiedl had a particular impact on the water level, but also had consequences for the reed belt. Therefore, we investigated the drought-influenced C fluxes and their drivers in the reed ecosystem of this subsaline lake over a period of 4.5 years (mid-2018 to 2022). We applied eddy covariance technique to continuously quantify the vertical turbulent GHG exchange between reed belt & atmosphere and used vegetation indices to account for reed growth. Methane emissions decreased by 76% from 9.2 g CH 4 -C m -2 a -1 (2019) to 2.2 g CH 4 -C m -2 a -1 (2022), which can be explained by the falling water level, the associated drying out of the reed belt and its consequences. Carbon dioxide emissions initially decreased by 85% from 181 g CO 2 -C m -2 a -1 (2019) to 27 g CO 2 -C m -2 a -1 (2021), but then increased to twice the 2019 level in 2022 (391 g CO 2 -C m -2 a -1 ). Due to the drying reed belt, the reed initially grew into formerly water-covered areas within the reed belt, especially in 2021, leading to higher photosynthesis through 2021. This development stopped and even reversed in 2022 as a consequence of the sharp decrease in sediment water content from about 65 to 32 Vol-% in mid-2022. Overall, drought led to a decoupling of the reed ecosystem from the open lake area and developed the wetland into a strong C source. • Falling lake water levels altered the mosaic in the reed belt and its carbon cycle. • Initially, drought led to reed growth within the reed belt, reducing CO 2 emissions. • With drop in sediment water content in 2022, CO 2 emissions doubled compared to 2019. • Annual CH 4 emissions of the reed belt decreased strongly over 4 years (2019–2022).