In 1978 major changes in shelf morphology were observed during a routine re-survey of part of the inner shelf region of the central Beaufort Sea. Regional observations are coupled with a detailed diving and side-scan study of a single ice gouge of known age to develop a detailed description of the altered seabed conditions. Hydrodynamic activity has caused extensive sediment reworking, obliterating ice gouges to water depths of at least 13 m and has caused ponding of sediment in ice gouge terrain in deeper waters. Ponded sediment is characterized as a soft, sometimes very poorly consolidated, mud unit underlain by a stiffer, more consolidated, silty clay. In places, stiff silty clay is exposed in windows in the sediment pond and displays a fine-textured ice gouge morphology. Rates of sediment reworking and redisposition from apparently episodic events are an order of magnitude greater than the average sediment accumulation rates on the Beaufort Sea shelf. Reported maximum ice gouge incision depths are not representative of maximum ice keel penetrations into the seabed because these sedimentation events preferentially infill gouges. Furthermore, because these sedimentation events concentrate sediments in gouge troughs, a series of overlapping and interfingering 'shoestring' deposits is developed which should characterize the ice gouge stratigraphy. The specific hydraulic mechanisms for sediment redistribution and sediment compaction observed in this study are only poorly understood.