Mitigation and adaptation represent two solutions to the issue of global warming. While mitigation aims at reducing CO2 emissions and preventing climate change, adaptation encompasses a broad scope of techniques used to reduce the impacts of climate change once they have occurred. Both have direct negative impacts on a country’s Gross Domestic Product, but costs also arise from temperature increases due to inaction. This paper analyzes the trade-offs between these costs in a real options model with tipping points and the possibility of major catastrophe. We determine the optimal timing and magnitude of mitigation in that framework.