Low soil organic matter content and limited soil water holding are the major natural constraint of dryland cropping on sandy soils in the Quebec boreal regions. We conducted a 3-yr (1994)(1995)(1996) study in a boreal sandy soil, FerroHumic Podzol (Spodosols), to determine the potential of Sphagnum peat for improving soil organic matter (SOM), water holding capacity, bulk density (BD), plant leaf nutrient status, and potato and barley yields. The cropping was a rotation of 2-yr potato (Solanum tuberosum L. 'Superior') and 1-yr barley (Hordeum vulgare L. 'Chapais'). The treatments consisted of Sphagnum peat at rates of 0, 29, 48, and 68 Mg ha −1 3-yr −1 on a dry weight basis, and granular N-P-K fertilizers (12-7.5-7) at rates of 1.4, 1.6, and 1.8 Mg ha −1 yr −1 , respectively, arranged in a splitblock design. The peat-amended soils were higher in water content (SWC), SOM and total porosity but lower in BD and N than neighboring non-peat soils (P < 0.05). Effects of peat and fertilizer treatments and their interaction were significant on potato leaf N, Ca, Mg, and P, tuber yield, dry weight, harvested N and tuber specific gravity (P < 0.05), depending on year. Potato tuber yield and N increased simultaneously up to 30% (compared to the control), and were significantly correlated with SWC, SOM, BD, and NO 3 -N (−0.52 ≤ r ≤ 0.80). In the 3rd year, the linear effect of peat treatments was significant on barley grain yield. In 1995 there was a decline of 4.5-7.3% of SOM of the previous year level. It is suggested that Sphagnum peat at a rate of 48 Mg ha −1 had the potential for improving sandy soil productivity. A longer-term investigation of soil water, N, SOM pool and crop yield changes is necessary to better understand the physical, chemical and biological processes of peat in cropping systems and to maximize the benefits of peat applications.Abbreviations: BD -soil bulk density; P t -peat; P t 0, P t 29, P t 48 and P t 68 -peat rate at 0, 29, 48 and 69 mg ha −1 ; SMP -soil matric potential; SWC -soil water content; SOM -soil organic matter content; TP -total porosity.