To better understand how photo-oxidation of dissolved organic matter (DOM) affects microbial activity and DOM processing along hydrological flow paths in an arctic catchment, we conducted experiments measuring responses in bacterial production (BP) to sunlight-exposed DOM from up-slope sources, including soil, stream, and lake water. Overall, sunlight exposure significantly reduced specific ultra-violet absorbance and dissolved organic carbon concentrations and increased phenolic concentrations; these changes were more pronounced in soil than in surface waters. Sunlight-exposed DOM reduced BP in common inoculum bioassay experiments at short time scales (hours), but the magnitude of the effect differed among DOM sources and was related to phenolic content; effects were more negative on DOM sources with high phenolic contents. In contrast, longer contact times (weeks) between bacteria and photo-oxidized soil, stream, and lake water DOM enhanced, did not change, and reduced BP, respectively. In these longer-term experiments, sunlight-exposed DOM had a greater positive effect on lake than stream BP, and caused shifts in bacterial community composition (based on denaturing gradient gel electrophoresis of bacterial-specific 16S rDNA). Changes in bacterial community composition were greater in response to sunlight-exposed DOM from soils than from the stream. Our findings suggest that overall impacts of DOM photo-oxidation in aquatic environments depends on DOM source, and that contrasting effects of photo-oxidized DOM at varying time scales may be partly due to shifts in the bacterial community composition to groups better able to consume photoproducts or tolerate harmful radicals.