Monitoring surface and atmospheric parameters—like water vapor—is challenging in the Arctic, despite the daily Arctic‐wide coverage of spaceborne microwave radiometer data. This is mainly due to the difficulties in characterizing the sea ice surface emission: sea ice and snow microwave emission is high and highly variable. There are very few data sets combining relevant in situ measurements with co‐located remote sensing data, which further complicates the development of accurate retrieval algorithms. Here, we present a multi‐parameter retrieval based on the inversion of a forward model for both, atmosphere and surface, for non‐melting conditions. The model consists of a layered microwave emission model of snow and ice. Since snow scattering and emission effects, as well as temperature gradients, are taken into account, a high variability in brightness temperatures can be simulated. For ocean regions and the atmosphere existing parameterized forward models are used. By using optimal estimation, the forward model can be inverted allowing for the simultaneous and consistent retrieval of nine variables: integrated water vapor, liquid water path, sea ice concentration, multi‐year ice fraction, snow depth, snow‐ice interface temperature and snow‐air interface temperature as well as sea‐surface temperature and wind speed (over open ocean). In addition, the method provides retrieval uncertainty estimates for each retrieved parameter. To evaluate the forward model as well as the retrieval, we use the extensive data sets acquired during the year‐long Arctic expedition Multidisciplinary drifting Observatory for the Study of Arctic Climate (2019–2020) as a reference.