Accurate modelling of peatland carbon dynamics is essential for understanding their role in the global carbon cycle and predicting greenhouse gas (GHG) fluxes under changing environmental and management conditions. We present PeatlandVU v3.0, an updated 1D process-based model with new representations of key above- and below-ground processes controlling peatland carbon exchange. Developments include improved vegetation phenology (leaf area index and growing degree days), alternative formulations for the temperature sensitivity of soil organic matter (SOM) decomposition, and explicit representation of anaerobic SOM mineralisation.</p> <p>Model behaviour and sensitivity were evaluated at two contrasting peatland sites in the Netherlands: a restored fen marshland (the Weerribben site) and a drained peat pasture (the Assendelft site) where model performance was evaluated against in situ flux measurements. Using ensembles of targeted perturbation experiments, we quantified sensitivity to internal parameters and environmental drivers and identified the processes and parameters that most strongly control variability in simulated CO₂ and CH₄ fluxes across contrasting peatland types. Beyond presenting new developments, this study provides a complete and consolidated sensitivity assessment of all processes and modules, not only newly implemented processes. The comprehensive evaluation provides a clear reference for future model developments, parametrisation and application to new sites.