Climate warming and human impacts are thought to be causing peatlands to dry, potentially converting them from sinks to sources of carbon. However, it is unclear whether the hydrological status of peatlands has moved beyond their natural envelope. Here we show that European peatlands have undergone substantial, widespread drying during the last ~300 years. We analyse testate amoeba-derived hydrological reconstructions from 31 peatlands across Britain, Ireland, Scandinavia and Continental Europe to examine changes in peatland surface wetness during the last 2,000 years. We find that 60% of our study sites were drier during the period 1800–2000 ce than they have been for the last 600 years, 40% of sites were drier than they have been for 1,000 years and 24% of sites were drier than they have been for 2,000 years. This marked recent transition in the hydrology of European peatlands is concurrent with compound pressures including climatic drying, warming and direct human impacts on peatlands, although these factors vary among regions and individual sites. Our results suggest that the wetness of many European peatlands may now be moving away from natural baselines. Our findings highlight the need for effective management and restoration of European peatlands.