Biological nitrogen fixation is an important source of bioavailable nitrogen in Sphagnum dominated peatlands. Sphagnum mosses harbor a diverse microbiome including nitrogen-fixing and methane (CH₄) oxidizing bacteria. The inhibitory effect of oxygen on microbial nitrogen fixation is documented for many bacteria. However, the role of nitrogen-fixing methanotrophs in nitrogen supply to Sphagnum peat mosses is not well explored. Here, we investigated the role of both oxygen and methane on nitrogen fixation in subarctic Sphagnum peat mosses. Five species of Sphagnum mosses were sampled from two mesotrophic and three oligotrophic sites within the Lakkasuo peatland in Orivesi, central Finland. Mosses were incubated under either ambient or low oxygen conditions in the presence or absence of methane. Stable isotope activity assays revealed considerable nitrogen-fixing and methane-assimilating rates at all sites (1.4 ± 0.2 µmol ¹⁵N–N₂ g⁻¹ DW day⁻¹ and 12.0 ± 1.1 µmol ¹³C–CH₄ g⁻¹ DW day⁻¹, respectively). Addition of methane did not stimulate incorporation of ¹⁵N-nitrogen into biomass, whereas oxygen depletion increased the activity of the nitrogen-fixing community. Analysis of the 16S rRNA genes at the bacterial community level showed a very diverse microbiome that was dominated by Alphaproteobacteria in all sites. Bona fide methane-oxidizing taxa were not very abundant (relative abundance less than 0.1%). Based on our results we conclude that methanotrophs did not contribute significantly to nitrogen fixation in the investigated peatlands.