Climate exerts strong control over the functioning of northern freshwater ecosystems, yet their resilience and responses to climate forcing may vary. We examined postglacial development patterns in subarctic Lake Varddoaijavri to discern the impact of direct climate controls, catchment influence, and ontogenic processes on the ecological functioning of the lake over the Holocene. Subfossil diatom assemblages together with the elemental and stable isotopic (delta C-13, delta N-15) composition of sediment organic matter were used to examine climate-induced changes in the structure of the phototrophic community and transport of terrestrial organic matter from the catchment. Stable isotopic composition (delta C-13, delta N-15) of subfossil Cladocera (Crustacea) was further used to assess how the changes were reflected higher up the food web. The diatom assemblages and sediment geochemistry closely mirrored the established climate patterns of the Holocene, confirming the strong climate coupling evidenced by earlier studies from lakes across the circumpolar Arctic. Our record indicates overarching influence of moisture fluctuations, superimposing the impact of light limitation by terrestrial organic carbon and temperature-driven alterations to lake physical regimes, which have been emphasized by recent research. The millennial changes in humidity were reflected as shifting dominance between planktonic and benthic diatom life forms, related to changes in the depth of the water column, vertical mixing patterns, and underwater light conditions. Despite the marked regime shifts at the base of the food web, zooplankton carbon utilization was little changed over the Holocene, likely attributable to selective feeding strategies. Overall, our results propose that the projected increases in precipitation in high-latitude regions may have marked impact on the structure and functioning of aquatic communities in shallow subarctic lakes.