Hydrology, particularly the water table position below the surface, is an important control on biogeochemical and ecological processes in peatlands. The position of the water table is a function of total storage changes, drainable porosity and peatland surface oscillation (PSO). Because the absolute level of the peat surface (ASL) oscillates in a peatland, we can assign two different water table positions: the water table depth below the surface (relative water level, RWL) and the water table position above an absolute elevation datum eg. sea level (absolute water level, AWL). A review of 37 studies that report peatland surface oscillation indicate a wide range (0.4-55 cm), which is to the same order as (or one order smaller than) water storage changes and RWL fluctuations. PSO can vary substantially across a single peatland and through time. A set of mechanisms (flotation, compression/shrinkage, gas volume changes and freezing) is hypothesised to cause ASL changes. The potential of PSO to reduce RWL fluctuations trended (mean in %) floating peatlands (63) > bogs (21), fens (18) > disturbed peatlands (10) with respect to peatland types. To investigate the spatiotemporal variability of peatland surface oscillation, AWL and ASL were monitored continuously over a one-year period (one site) and monthly (23 sites) in a warm-temperate peatland that is dominated by Empodisma minus (Restionaceae). A new measurement method was developed by pairing two water level transducers, one attached to a stable benchmark (ÆAWL) and one attached to the peat surface (ÆRWL). From August 2005 until August 2006 the ASL oscillated at one site through a range of 22 cm following AWL fluctuations (in total 47 cm). Consequently, RWL fluctuations were reduced on average to 53% of AWL fluctuations. The strong AWL-ASL relationship was linear for 15 sites with manual measurements. However, eight sites showed significantly higher rates of peatland surface oscillation during the wet season (ie. high AWLs) and thus a non-linear behaviour. Temporary flotation of upper peat layers during the wet season may have caused this non-linear behaviour. On the peatland scale AWL fluctuations (mean 40 cm among sites) were reduced by 30–50% by PSO except for three sites with shallow and dense peat at the peatland margin (7–11%). The reduction of RWL fluctuation was high compared to literature values. The spatial variability of PSO seemed to match well with vegetation patterns rather than peat thickness or bulk density. Sites with large PSO showed high cover of Empodisma minus. Surface level changes exhibited surprisingly hysteretic behaviour subsequent to raised AWLs, when the rise of ASL was delayed. This delay reversed the positive ASL-AWL relationship because the surface slowly rose even though AWL started receding. Hysteresis was more pronounced during the dry season than during the wet season. The observed hysteresis can be sufficiently simulated by a simplistic model incorporating delayed ASL fluctuations. PSO has wide implications for peatland hydrology by reducing RWL fluctuations, which feed back to peat decomposition and plant cover and potentially to (drainable) porosity. Stable RWL also reduce the probability of surface run-off. It is further argued that the gas content of the roots of plants, particularly Empodisma minus, added enough buoyancy to detach the uppermost peat layers resulting in flotation.