The uptake of atmospheric carbon dioxide (CO2) into the mid-latitudes of the North Atlantic Ocean through the production of wintertime Sub-Tropical Mode Water (STMW) also known as Eighteen Degree Water (EDW) is poorly quantified and constrained. Nonetheless, it has been proposed that the EDW could serve as an important short-term sink of anthropogenic CO2. The objective of the present investigation was to determine sea–air CO2 gas exchange rates and seawater CO2 dynamics during wintertime formation of EDW in the North Atlantic Ocean. During 2006 and 2007, several research cruises were undertaken as part of the CLIMODE project across the northwest Atlantic Ocean with the intent to study the pre-conditioning, formation, and the evolution of EDW. Sea–air CO2 exchange rates were calculated based on measurements of atmospheric pCO2, surface seawater pCO2 and wind speed with positive values denoting a net flux from the surface ocean to the atmosphere. Average sea–air CO2 flux calculated along cruise tracks in the formation region equaled −18±6 mmol CO2 m−2 d−1 and −14±9 mmol CO2 m−2 d−1 in January of 2006 and March of 2007, respectively. Average sea–air CO2 flux in newly formed outcropping EDW in February and March of 2007 equaled −28±10 mmol CO2 m−2 d−1. These estimates exceeded previous flux estimates in this region by 40–185%. The magnitude of CO2 flux was mainly controlled by the observed variability in wind speed and ΔpCO2 with smaller changes owing to variability in sea surface temperature. Small but statistically significant difference (4.1±2.6 μmol kg−1) in dissolved inorganic carbon (DIC) was observed in two occurrences of newly formed EDW in February and March of 2007. This difference was explained either by differences in the relative contribution from different water masses involved in the initial formation process of EDW or temporal changes owing to sea–air CO2 exchange (∼25%) and vertical and/or lateral mixing (∼75%) with water masses high in DIC from the cold side of the Gulf Stream and/or from below the permanent thermocline. Based on the present estimate of sea–air CO2 flux in newly formed EDW and a formation rate of 9.3 Sv y (Sverdrup year=106 m3 s−1 flow sustained for 1 year), CO2 uptake by newly formed EDW may constitute 3–6% of the total North Atlantic CO2 sink. However, advection of surface waters that carry an elevated burden of anthropogenic CO2 that are transported to the formation region and transformed to mode water may contribute additional CO2 to the total net uptake and sequestration of anthropogenic CO2 to the ocean interior.