Almost all current climate models simplify the ocean surface albedo (OSA) by assuming the reflected solar energy without the ocean interior contribution. In this study, an improved ocean surface albedo scheme is incorporated into the Community Earth System Model version 2 (CESM2) to assess the sensitivity of Arctic surface temperature to including ocean interior reflectance to the OSA. Fully coupled CESM2 simulations with and without ocean interior reflectance are subsequently performed, we focus on the analysis of Arctic surface temperature responses. Incorporating ocean interior reflectance increases absorbed solar radiation and warms the ocean, enhancing seasonal heat storage and release across the Arctic Ocean, and increasing sea ice reduction and positive climate feedbacks that elevates Arctic surface temperature. Seasonal variations in air-surface temperature differences induce changes in turbulent heat flux patterns, concurrently modifying dynamic advection and moisture processes that affect boundary layer humidity and low clouds, especially in winter. Based on partitioning physical processes in the thermodynamic energy equation, surface air warming is induced primarily through positive heating anomalies of vertical advection, latent heat release, and longwave radiative forcing. Through an examination of the surface energy budget, skin temperature warming is driven predominantly by increased downward longwave radiation, positive surface albedo feedback in summer, and increased conductive heat transport from the ocean particularly in winter. Significant effects of ocean interior reflectance on the Arctic Ocean, including sea surface warming and sea ice reduction, justify the importance of ocean interior reflectance in climate models for better understanding of ongoing Arctic climate changes.