AbstractSemiarid grasslands contribute significantly to global soil carbon (C) storage. Carbon loss from these systems via microbial decomposition is controlled by abiotic and biotic factors such as soil moisture and temperature and C input. Plant litter in these systems can be present above the soil surface or mixed with surface soil by trampling, especially in intensively grazed areas. A quantitative understanding of abiotic factors' interactive effect is critical for predicting soil C dynamics in response to grassland management and environmental conditions changes. Therefore, we conducted a 3‐month laboratory incubation experiment to quantify the impact of litter placement and soil moisture on soil carbon dioxide (CO2) emissions under three controlled temperatures. The treatments including three litter placements (no litter, litter on top and litter mixed with surface soil) and three soil moisture levels (23%, 37% and 50% water‐filled pore space [WFPS]) were incubated at three temperatures (10°C, 20°C and 30°C). Carbon dioxide fluxes were measured every 2 weeks. Soil CO2 fluxes were higher for all moisture and litter treatments initially and declined overtime at 20°C and 30°C. Mixing litter with soil increased the cumulative CO2 emissions by 24% and 19.5% at 20°C and 30°C, respectively, compared to no litter. Also, soil‐litter mixing compared with litter on top showed a 14.3% and 21.6% increase in cumulative CO2 emissions at temperatures of 20°C and 30°C, respectively. At all temperatures, 37% and 50% WFPS resulted in similar cumulative CO2 emissions. The results from this study indicate that rising temperatures from 10°C to 30°C accelerate the effect of soil litter mixing on increasing CO2 emissions compared to litter on top and no litter.