Hydrothermal processes are key components of permafrost dynamics and hydrological and carbon cycles in northern forest ecosystems. A forest hydrology model, ForHyM, was used to evaluate these processes by determining how the depth and duration of frost penetration into the soil would vary daily over the course of several decades. This was done for chosen upland/wetland conditions within the Mackenzie Plain south of Fort Simpson, where permafrost is currently sporadic to discontinuous. The model calculations were done using daily weather records from November 1963 to 2010, starting with a hypothetical no-frost condition within the soil and subsoil. Model performance was evaluated by comparing modeled and measured temperatures at different soil depths (upland and peat plateau modelling, R² = 0.95 and 0.94, respectively). It was found that well-drained upland forests within the general area would experience deep and complete freeze—thaw cycles each year. In contrast, poorly drained wetlands would develop gradually deepening permafrost that would at first stabilize in depth over the course of 10 to 20 y, with thaw depth limited to <1 m each year. However, recent increases in recorded air temperature (more so in winter than in summer) would destabilize the permafrost layer, and this would especially occur in areas with insufficient surface insulation by local peat, moss, forest litter, and snow accumulations. These estimates are consistent with (i) reported thawing depths and (ii) the widening encroachment of collapse scars towards the poorly drained portions of the South Mackenzie Plain.