As the Arctic ice recedes, the opportunities for all year round routing of merchant shipping through Arctic waters rise. The freeing up of Arctic waters may also attract increased numbers of scientific research vessels servicing oil and gas installations, foreign fishing vessels and warships. The prospect of major navigational channels opening up in this region brings risks to a pristine Arcti environment and its indigenous inhabitants. This article highlights the threats posed to the species, habitats and ecosystems of Arctic waters from increased shipping transits of the region including the potential for increased vessel source discharges of noxious and hazardous substances and the catastrophic consequences of groundings for the Arctic environment and its biodiversity. It reviews the legal controversies over the status of certain parts of Arctic waters and the navigational regimes applicable to foreign flag vessels transiting Arctic waters under the 1982 United Nations Law of the Sea Convention (LOSC). The need to balance navigational rights with appropriate environmental safeguards under an increasing array of international environmental principles including the precautionary approach and obligations to assess the impact of ship based activities on the global environment and its marine components is examined. The article then analyses some of the regulatory mechanisms which have been devised to promote environmentally sustainable navigation for shipping in sensitive areas of ocean space subject to high levels of shipping traffic through the International Maritime Organization (IMO).