In Arctic wet tundra microbial controls on organic matter decomposition are likely to be altered as a result of climatic disruption. Here we present a study on the activity, diversity and vertical distribution of methane-cycling microbial communities in the active layer of wet polygonal tundra on Herschel Island. We recorded methane production rates from 5 to 40 nmol h-1 g-1 wet soil at 10 °C and significantly higher potential methane oxidation rates reaching values of 6 to 10 µmol h-1 g-1 wet soil. Terminal restriction fragment length polymorphism (T-RFLP) and cloning analyses of mcrA and pmoA genes demonstrated that both communities were stratified along the active layer vertical profile. Similar to other wet Arctic tundra, the methanogenic community hosted hydrogenotrophic (Methanobacterium) as well as acetoclastic (Methanosarcina and Methanosaeta) members. A pronounced shift towards a dominance of acetoclastic methanogens was observed in deeper soil layers. In contrast to related circum-Arctic studies, the methane oxidizing (methanotrophic) community on Herschel Island was dominated by members of the type II group (Methylocystis, Methylosinus, and a cluster related to Methylocapsa). The present study represents the first on methane-cycling communities in the Canadian Western Arctic, thus advancing our understanding on these communities in a changing Arctic.