Plant macrofossils from permafrost deposits at the Bolshoy Lyakhovsky Island, New Siberian Archipelago, in the Russian Arctic revealed the existence of a shrubland dominated by Alnus fruticosa, Betula nana, and Ledum palustre and interspersed with lakes and grasslands during the last interglacial. The reconstructed palaeovegetation differs fundamentally from the high arctic tundra that exists in this region today, but resembles subarctic shrub tundra occurring near the tree line about 350 km southwest of the study site, however being more open. Similar vegetation was reconstructed also from pollen data. Such vegetation implies that, during the last interglacial, the mean summer temperature was considerably higher, the growing season was extended, and soils outside the range of thermokarst depressions were, possibly due to increased evaporation, drier than today. Pollen based climatic reconstructions yielded a mean July temperature of at least 7-8° C during the warmest interval. Reconstructions from plant macrofossils, representing more local environments, gained even more than 12°C in contrast to todays 2.5°C. We explain the contrast in summer temperature and moisture conditions during the last warm stage opposite to today with a combination of higher insolation due to changes in the Earths orbital parameters and higher continentality in arctic Yakutia as result of a considerably less inundated Laptev Shelf. Accordingly, the excessive Holocene marine transgression was possibly an unique event as consequence of tectonic extension and intense subsidence of the Laptev Sea Shelf with dramatic effects for the arctic biota