Pronounced positive decadal-scale temperature anomalies occurred in the Arctic region in the first half of the twentieth century, an episode known as the early twentieth century warming (ETCW). Analyzing a 3,000-year unperturbed climate simulation performed with the Max Planck Institute Earth System Model, we demonstrate that internal variability of the Northern Hemisphere climate system is sufficient to reproduce warm events matching the observed ETCW. We perform a superposed epoch analysis on simulated data and identify 26 Arctic warming episodes compatible with the ETCW. The simulated events reproduce, in their ensemble average, magnitude as well as spatial and temporal extent of the observed ETCW. In individual realizations, the ETCW-like events indicate that different patterns of internally generated decadal Arctic warming are possible, including pan-Arctic warming events. We investigate the dynamics that typically lead to the simulated warming events: positive oceanic heat transport anomalies that form in the North Atlantic initialize the warming events and trigger an ocean-ice-albedo feedback in the Barents Sea region. The consequent reduction in sea-ice extent leads to enhanced multi-year surface warming through strengthened ocean heat release to the atmosphere. The oceanic heat transport anomalies reduce to pre-event levels around the year of the maximum warming. However, the warming events typically lasts for another 5-7 years until the sea-ice extent recovers to pre-event conditions.