A distinct, subsurface density front along the eastern St. Anna Trough in the northern Kara Sea is inferred from hydrographic observations in 1996 and 2008–2010. Direct velocity measurements show a persistent northward subsurface current (~ 18 cm s−1) along the St. Anna Trough eastern flank. This sheared flow, carrying the outflow from the Barents and Kara seas to the Arctic Ocean, is also evident from shipboard observations as well as from geostrophic velocities and numerical model simulations. Although we cannot substantiate our conclusions by direct observation-based estimates of mixing rates in the area, we hypothesize that the enhanced vertical mixing along the St. Anna Trough eastern flank favors the upward heat loss from the intermediate warm Atlantic water layer. Modeling results support this hypothesis. The upward heat flux inferred from hydrographic data and model simulations is of O(30–100) W m−2. The region of lowered sea ice thickness and concentration seen both in sea ice remote sensing observations and model simulations marks the Atlantic water pathway in the St. Anna Trough and adjacent Nansen Basin continental margin. In fact, the sea ice shows a delayed freeze-up onset during fall and a reduction in the sea ice thickness during winter. This is consistent with our results on the enhanced Atlantic water heat loss along the Atlantic water pathway in the St. Anna Trough.