Abstract Active layer thickness (ALT) is a critical metric for monitoring permafrost. How soil moisture influences ALT depends on two competing hypotheses: (a) increased soil moisture increases the latent heat of fusion for thaw, resulting in shallower active layers, and (b) increased soil moisture increases soil thermal conductivity, resulting in deeper active layers. To investigate their relative influence on thaw depth, we analyzed the Field Measurements of Soil Moisture and Active Layer Thickness (SMALT) in Alaska and Canada dataset, consisting of thousands of measurements of thaw depth and soil moisture collected at dozens of sites across Alaska and Canada as part of NASA’s Arctic Boreal Vulnerability Experiment (ABoVE). As bulk volumetric water content (VWC) integrated over the entire active layer increases, ALT decreases, supporting the latent heat hypothesis. However, as VWC in the top 12 cm of soil increases, ALT increases, supporting the thermal conductivity hypothesis. Regional temperature variations determine the baseline thaw depth while precipitation may influence the sensitivity of ALT to changes in VWC. Soil latent heat dominates over thermal conductivity in determining ALT, and the effect of bulk VWC on ALT appears consistent across sites.