Recent attention regarding the impacts of oil and gas development and exploitation has focused on the unintentional release of hydrocarbons into the environment, whilst the potential negative effects of other possible avenues of environmental contamination are less well documented. In the hydrocarbon-rich and ecologically sensitive Mackenzie Delta region (NT, Canada), saline wastes associated with hydrocarbon exploration have typically been disposed of in drilling sumps (i.e., large pits excavated into the permafrost) that were believed to be a permanent containment solution. However, failure of permafrost as a waste containment medium may cause impacts to lakes in this sensitive environment. Here, we examine the effects of degrading drilling sumps on water quality by combining paleolimnological approaches with the analysis of an extensive present-day water chemistry dataset. This dataset includes lakes believed to have been impacted by saline drilling fluids leaching from drilling sumps, lakes with no visible disturbances, and lakes impacted by significant, naturally occurring permafrost thaw in the form of retrogressive thaw slumps. We show that lakes impacted by compromised drilling sumps have significantly elevated lakewater conductivity levels compared to control sites. Chloride levels are particularly elevated in sump-impacted lakes relative to all other lakes included in the survey. Paleolimnological analyses showed that invertebrate assemblages appear to have responded to the leaching of drilling wastes by a discernible increase in a taxon known to be tolerant of elevated conductivity coincident with the timing of sump construction. This suggests construction and abandonment techniques at, or soon after, sump establishment may result in impacts to downstream aquatic ecosystems. With hydrocarbon development in the north predicted to expand in the coming decades, the use of sumps must be examined in light of the threat of accelerated permafrost thaw, and the potential for these industrial wastes to impact sensitive Arctic ecosystems.