The spatial pattern of recent ice reduction in the Arctic Ocean is similar to the distribution of warm Pacific Summer Water (PSW) that interflows the upper portion of halocline in the southern Canada Basin. Increases in PSW temperature in the basin are also well-correlated with the onset of sea-ice reduction that began in the late 1990s. However, increases in PSW temperature in the basin do not correlate with the temperature of upstream source water in the northeastern Bering Sea, suggesting that there is another mechanism which controls these concurrent changes in ice cover and upper ocean temperature. We propose a feedback mechanism whereby the delayed sea-ice formation in early winter, which began in 1997/1998, reduced internal ice stresses and thus allowed a more efficient coupling of anticyclonic wind forcing to the upper ocean. This, in turn, increased the flux of warm PSW into the basin and caused the catastrophic changes.