Inhabitants of low-lying islands flooded due to anthropogenic climate change will lose their territory and thereby their ability to exercise their right to political self-determination. This paper addresses the normative questions which arise when climate change threatens territorial rights. It explores whether the loss of statehood supports a claim to territorial compensation, and if so, how it can be satisfied. The paper concludes that such claims are well founded and that they should be met by providing compensatory territories. After introducing (...) a differentiation between land rights and territorial rights, previous theoretical responses to the problem of sinking islands are criticized. It is argued that states may be required to give up parts of their territory as compensation. The paper develops criteria of sufficiency for compensatory territories and proposes to base their selection process on a negative auction. Since it is unlikely that unsettled compensatory territories that meet the specified requirements are available, the rights of their original inhabitants are discussed. (shrink)