Coring and cutting devices were developed to extract 30 cm cores from peat under conditions which preserve their physical/spatial integrity, maintain anoxic conditions and allow transverse sectioning. Methane production potential, measured on 1-2 cm vertical sections, was broadly absent from the upper 5 cm, maximum in the next 10 cm and thereafter declined. Methane oxidation potential was maximum in the upper 10 cm and thereafter detected in reducing amounts. Molecular methods, based on the extraction of total DNA and its PCR amplification and hybridisation with specific phylogenetic 16S rRNA and functional gene specific primers and probes, were developed to analyse the methane producing and methane oxidising microbial communities. The functional gene sequences were based on methanogen methyl coenzyme reductase and methanotroph methane monooxygenase. Methanotrophs are located throughout the core whereas methanogens are restricted to the lower zones. The composition of the microbial communities is however complex consisting of a number of novel species not previously recognised and with the various species/sub-groups occupying different vertical zones.