Monitoring of stable water isotopes (18O and 2H) in precipitation and surface waters in the Mackenzie River basin of northern Canada has created new opportunities for researchers to study the complex hydrology and hydroclimatology of this remote region. A number of prior studies have used stable isotope data to investigate aspects of the hydrological regime of the wetland-dominated terrain near Fort Simpson, Northwest Territories, Canada. The present paper compares estimates of groundwater contributions to streamflow derived using the WATFLOOD distributed hydrological model, equipped with a new water isotope tracer module, with the results of conventional isotope hydrograph separation for five wetland-dominated catchments along the lower Liard River. The comparison reveals highly promising agreement, verifying that the hydrological model is simulating groundwater flow contributions to total streamflow with reasonable fidelity, especially during the crucial snowmelt period. Sensitivity analysis of the WATFLOOD simulations also reveals intriguing features about runoff generation from channelized fens, which may contribute less to streamflow than previously thought.