1. Northern hemisphere peatlands are globally important stores of organic soil carbon. We examined effects of plant functional group identity on short-term carbon (C) flux in an ombrotrophic peatland in northern England, UK, by selectively removing one of each of the three dominant plant functional groups (ericoid dwarf-shrubs, graminoids and bryophytes). Carbon dynamics were quantified by a combination of CO2 flux measurements and 13CO2 stable isotope pulse labelling approaches. 2. Significant effects of plant functional group removals on CO2 fluxes and tracer 13C uptake and turnover were detected. Removal of ericoid dwarf-shrubs had the greatest influence on gross CO2 flux, increasing rates of respiration and photosynthesis by > 200% relative to the undisturbed control. After pulse labelling with 13CO2, we found that turnover of recent photosynthate, measured as respired 13CO2, was also greatest in the absence of dwarf-shrubs. 3. Analysis of 13C tracer enrichment in leaf tissues from all plant removal treatments showed that the rate of fixation of 13CO2 and turnover of 13C labelled photosynthate in leaf tissue was greatest in graminoids and lowest in bryophytes. Furthermore, graminoid leaf 13C enrichment was greatest when growing in the absence of dwarf-shrubs, suggesting that the presence of dwarf-shrubs reduced the photosynthetic activity of graminoids. 4. We conclude that plant functional groups differentially influence the uptake and short-term flux of carbon in peatlands, suggesting that changes in the functional composition of vegetation resulting from global change have the potential to alter short-term patterns of carbon exchange in peatland.