Abstract The recent Arctic winter sea ice retreat is most pronounced in the Barents Sea. Using available observations of the Atlantic inflow to the Barents Sea and results from a regional ice–ocean model the authors assess and quantify the role of inflowing heat anomalies on sea ice variability. The interannual variability and longer-term decrease in sea ice area reflect the variability of the Atlantic inflow, both in observations and model simulations. During the last decade (1998–2008) the reduction in annual (July–June) sea ice area was 218 × 103 km2, or close to 50%. This reduction has occurred concurrent with an increase in observed Atlantic heat transport due to both strengthening and warming of the inflow. Modeled interannual variations in sea ice area between 1948 and 2007 are associated with anomalous heat transport (r = −0.63) with a 70 × 103 km2 decrease per 10 TW input of heat. Based on the simulated ocean heat budget it is found that the heat transport into the western Barents Sea sets the boundary of the ice-free Atlantic domain and, hence, the sea ice extent. The regional heat content and heat loss to the atmosphere scale with the area of open ocean as a consequence. Recent sea ice loss is thus largely caused by an increasing “Atlantification” of the Barents Sea.