Perennial groundwater discharge in a tributary of Donjek River causes severe icing problems at km 1817.5 (mile post 1130) on the Alaska Highway. Surveys of a section across the icing area revealed vertical ground movements of up to 0.92 m between winter and summer. Subsurface ice bodies up to 0.75 m thick appear to form in some winters, degrading in the following summer(s). The ground movements and the ice bodies are indicative of the formation and degradation of frost mounds. Airphotos of the study area indicate that icing activity was either induced or enhanced by construction of the highway. The distribution of reaction wood in white spruce growing on the valley bottom indicates several episodes of tilting, in various directions. The reaction-wood chronology shows that ground movements occurred in this area long before construction of the highway. Construction of the highway may, however, have affected the rate of groundwater discharge and the magnitude of icing and frost-mound activity.