Carbon-rich permafrost coasts in the Arctic are subject to rapid erosion, causing vast quantities of carbon and sediments to enter the nearshore. According to many climate models, the Arctic will experience disproportionate warming in coming decades. One of the consequences will be increased coastal erosion, as the open water season lengthens. The release of carbon raises a number of questions ranging from the impact on local ecosystems, to potential climate change feedbacks. Due to the size and remoteness of arctic coasts, relatively few studies addressed the question of carbon transfer into the Arctic Ocean. These studies rely on remotely sensed data which means that the submarine portion of the coast, the processes and storage potential remain largely unknown. The Coastal Permafrost Erosion project by the Alfred Wegener Institute aims to answer some of these questions by quantifying erosion and characterizing eroded material for the whole coastal tract in the vicinity of Herschel Island, Yukon Territory, Canada. In this study, we describe the investigations of nearshore sediment and carbon dynamics carried out as part of the project in 2012 and 2013. The objective of the study is to establish a baseline dataset on bottom sediments, and gain insight into transport processes, pathways, and sinks. Phase Measuring Bathymetry allows to collect co-registered high-resolution bathymetry and side scan sonar data. The system chosen was a 500kHz system, which provided optimum coverage for the water depths of the reference area. The bathymetric data provided insight into physical processes such as ice gouging (Fig. 1), while compensated side scan mosaics delivered a map of sediment distribution (Fig. 2). The side scan data was processed, mosaicked and classified using the software tools provided by the sonar manufacturer, as well as the bathymetry. For the present study, both were gridded at 0.5 m resolution. Through the compensated backscatter imagery, we identified areas where fine sediments are deposited and carbon may be stored. The classified seafloor image was validated by grain size parameters from the benthic grab samples with a very high degree of correlation. A significant portion of the released carbon is particulate organic matter which is transported along with the sediment. Elemental analysis of the grab samples revealed that organic carbon may account for up to 9% of the bottom sediment. We also found that the shoreface is subject to intensive ice gouging. Finally, we found that the sediment distribution in the nearshore is related to terrestrial features being eroded, e.g. cliffs, or valleys.