AbstractMethane (CH4) emissions from climate‐sensitive ecosystems within the northern permafrost region represent a potentially large but highly uncertain source, with current estimates spanning a factor of seven (11–75 Tg CH4 yr−1). Accelerating permafrost thaw threatens significant increases in pan‐Arctic CH4 emissions, amplifying the permafrost carbon feedback. We used airborne imaging spectroscopy with meter‐scale spatial resolution and broad coverage to identify a previously undiscovered CH4 emission hotspot adjacent to a thermokarst lake in interior Alaska. Hotspot emissions were confined to <1% of the 10 ha lake study area. Ground‐based chamber measurements confirmed average daily fluxes from the hotspot of 1,170 mg CH4 m−2 d−1, with extreme daily maxima up to 24,200 mg CH4 m−2 d−1. Ground‐based geophysical measurements revealed thawed permafrost directly beneath the CH4 hotspot, extending to a depth of ∼15 m, indicating that the intense CH4 emissions likely originated from recently thawed permafrost. Hotspot emissions accounted for ∼40% of total diffusive CH4 emissions from the lake study site. Combining study site findings with hotspot statistics from our 70,000 km2 airborne survey across Alaska and northwestern Canada, we estimate that pan‐Arctic terrestrial thermokarst hotspots currently emit 1.1 (0.1–5.2) Tg CH4 yr−1, or roughly 4% of the annual pan‐Arctic wetland budget from just 0.01% of the northern permafrost land area. Our results suggest that significant proportions of pan‐Arctic CH4 emissions originate from disproportionately small areas of previously undetermined thermokarst emissions hotspots, and that pan‐Arctic CH4 emissions may increase non‐linearly as thermokarst processes increase under a warming climate.