Saltwater intrusion and salinization of coastal wetlands around the world are becoming a pressing issue due to sea level rise. Here, we assessed how a freshwater coastal wetland ecosystem responds to saltwater intrusion. In wetland mesocosms, we continuously exposed Cladium jamaicense Crantz (sawgrass) plants and their peat soil collected from a freshwater marsh to two factors associated with saltwater intrusion in karstic ecosystems: elevated loading of salinity and phosphorus (P) inputs. We took repeated measures using a 2 × 2 factorial experimental design (n = 6) with treatments composed of elevated salinity (~9 ppt), P loading (14.66 μmol P/d), or a combination of both. We measured changes in water physicochemistry, ecosystem productivity, and plant biomass change over two years to assess monthly and two‐year responses to saltwater intrusion. In the short‐term, plants exhibited positive growth responses with simulated saltwater intrusion (salinity + P), driven by increased P availability. Despite relatively high salinity levels for a freshwater marsh (~9 ppt), gross ecosystem productivity (GEP), net ecosystem productivity (NEP), and aboveground biomass were significantly higher in the elevated salinity + P treated monoliths compared to the freshwater controls. Salinity stress became evident after extended exposure. Although still higher than freshwater controls, GEP and NEP were significantly lower in the elevated salinity + P treatment than the +P treatment after two years. However, elevated salinity decreased live root biomass regardless of whether P was added. Our results suggest that saltwater intrusion into karstic freshwater wetlands may initially act as a subsidy by stimulating aboveground primary productivity of marsh plants. However, chronic exposure to elevated salinity results in plant stress, negatively impacting belowground peat soil structure and stability through a reduction in plant roots.