Algal bioindicators, such as diatoms, often show subdued responses to eutrophication in Arctic lakes because climate‐related changes (e.g., ice cover) tend to be the overriding factors influencing assemblage composition. Here, we examined how sub‐Arctic ponds historically receiving high nutrient inputs from nesting seabirds have responded to recent climate change. We present diatom data obtained from 12 sediment cores in seaduck‐affected ponds located on islands through Hudson Strait, Canada. All study cores show consistently elevated values of sedimentary ẟ15N, an established proxy for tracking marine‐derived nutrients, indicating seabirds have been present on these islands for at least the duration of the sediment records (~100 to 400 years). We document diverse epiphytic diatom assemblages to the base of all sediment cores, which is in marked contrast to seabird‐free Arctic ponds—these oligotrophic sites typically record epilithic diatom flora prior to recent warming. Diatoms are likely responding indirectly to seabird nutrients via habitat as nutrients promote the growth of mosses supporting epiphytic diatom communities. This masks the typical diatom response to increased warming in the Arctic, which also results in habitat changes and the growth of mosses around the pond edges. Changes in sedimentary chlorophyll a were not consistently synchronous with large changes in ẟ15N values, suggesting that primary production in ponds is not responding linearly to changes in seabird‐derived nitrogen. Across all ponds, we recorded shifts in diatom epiphytic assemblages (e.g., increases in % relative abundance of many Nitzschia species) that often align with increases in chlorophyll a. The changes in diatoms and chlorophyll a, although variable, are most likely driven by climate change as they are generally consistent with longer ice‐free conditions and growing seasons. Together, our results show that to effectively use diatoms in animal population reconstructions across the sub‐Arctic and Arctic, a strong understanding of eutrophication and climate change, based on supplementary proxies, is also required.