Abstract Many of the world's northern peatlands are underlain by rapidly thawing permafrost. Because plant production in these peatlands is often nitrogen ( N )‐limited, a release of N stored in permafrost may stimulate net primary production or change species composition if it is plant‐available. In this study, we aimed to quantify plant‐available N in thawing permafrost soils of subarctic peatlands. We compared plant‐available N ‐pools and ‐fluxes in near‐surface permafrost (0–10 cm below the thawfront) to those taken from a current rooting zone layer (5–15 cm depth) across five representative peatlands in subarctic Sweden. A range of complementary methods was used: extractions of inorganic and organic N, inorganic and organic N ‐release measurements at 0.5 and 11 °C (over 120 days, relevant to different thaw‐development scenarios) and a bioassay with Poa alpina test plants. All extraction methods, across all peatlands, consistently showed up to seven times more plant‐available N in near‐surface permafrost soil compared to the current rooting zone layer. These results were supported by the bioassay experiment, with an eightfold larger plant N ‐uptake from permafrost soil than from other N ‐sources such as current rooting zone soil or fresh litter substrates. Moreover, net mineralization rates were much higher in permafrost soils compared to soils from the current rooting zone layer (273 mg N m −2 and 1348 mg N m −2 per growing season for near‐surface permafrost at 0.5 °C and 11 °C respectively, compared to −30 mg N m −2 for current rooting zone soil at 11 °C). Hence, our results demonstrate that near‐surface permafrost soil of subarctic peatlands can release a biologically relevant amount of plant available nitrogen, both directly upon thawing as well as over the course of a growing season through continued microbial mineralization of organically bound N . Given the nitrogen‐limited nature of northern peatlands, this release may have impacts on both plant productivity and species composition.