We estimated the magnitude of the radiative forcing (RF) due to changes in albedo following the forestation of peatlands, and calculated the net RF by taking into account the changes in both the albedo and the greenhouse gas (GHG) fluxes during one forest rotation. Data on radiation, tree biomass, and soil GHG fluxes were combined with models for canopy cover, tree carbon accumulation, and the RF due to increased atmospheric GHG concentrations for four typical site cases in Finland covering two soil nutrient levels in the south and north of the country. We also studied the observed long‐term surface temperatures to detect any indications of drainage‐induced effects. The magnitude of the albedo‐induced RF was similar to that caused by the carbon sequestration of the growing trees. At three site cases out of four the drainage induced a cooling or negative RF, the tendency for cooling being higher at sites with a higher nutrient level. The differences in albedo‐induced RF mainly arose from the spring season due to (1) the different snow cover duration in the south versus the north, and (2) the different albedos of drained and undrained snow covered peatlands. An increase in the maximum daily temperatures was observed in April in southern Finland, where the most intensive drainage practices have taken place, suggesting that forestry drainage has potentially affected the local climate. Our results show that the decreasing albedo resulting from peatland forestation contributes significantly to the RF, balancing out or even exceeding the cooling effect due to the changing GHG fluxes.