Latitudinal variation in thermal reaction norms of key fitness traits may inform about the response of populations to climate warming, yet their adaptive nature and evolutionary potential are poorly known. We assessed the contribution of quantitative genetic, neutral genetic and environmental effects to thermal reaction norms of growth rate for populations of the damselfly Ischnura elegans. Among populations, reaction norms differed primarily in elevation, suggesting that time constraints associated with shorter growth seasons in univoltine, high-latitude as well as multivoltine, low-latitude populations selected for faster growth rates. Phenotypic divergence among populations is consistent with selection rather than drift as QST was greater than FST in all cases. QST estimates increased with experimental temperature and were influenced by genotype by environment interactions. Substantial additive genetic variation for growth rate in all populations suggests that evolution of trait means in different environments is not constrained. Heritability of growth rates was higher at high temperature, driven by increased genetic rather than environmental variance. While environment-specific nonadditive effects also may contribute to heritability differences among temperatures, maternal effects did not play a significant role (where these could be accounted for). Genotype by environment interactions strongly influenced the adaptive potential of populations, and our results suggest the potential for microevolution of thermal reaction norms in each of the studied populations. In summary, the observed latitudinal pattern in growth rates is adaptive and results from a combination of latitudinal and voltinism compensation. Combined with the evolutionary potential of thermal reaction norms, this may affect populations’ ability to respond to future climate warming.