Permafrost is thawing extensively due to climate warming. When permafrost thaws, previously frozen organic carbon (OC) is converted into carbon dioxide (CO2) or methane, leading to further warming. This process is included in models as gradual deepening of the seasonal non‐frozen layer. Yet, models neglect abrupt OC mobilization along rapidly eroding Arctic coastlines. We mimicked erosion in an experiment by incubating permafrost with seawater for an average Arctic open‐water season. We found that CO2 production from permafrost OC is as efficient in seawater as without. For each gram (dry weight) of eroding permafrost, up to 4.3 ± 1.0 mg CO2 will be released and 6.2 ± 1.2% of initial OC mineralized at 4 °C. Our results indicate that potentially large amounts of CO2 are produced along eroding permafrost coastlines, onshore and within nearshore waters. We conclude that coastal erosion could play an important role in carbon cycling and the climate system.