Given the increasing impacts of human activities on global nitrogen (N) cycle, investigations on N transformation processes in the marine environment have drastically increased in the last years. Benthic N cycling has mainly been studied in anthropogenically impacted estuaries and coasts, while its understanding in oligotrophic systems is still scarce. Here we report on rates of denitrification, anammox and dissimilatory nitrate reduction to ammonium (DNRA) studied by in situ incubations with benthic chamber landers during two cruises to the Gulf of Bothnia (GOB), a cold, oligotrophic basin located in the northern part of the Baltic Sea. Burial and benthic solute fluxes were also experimentally determined to investigate the fate of fixed N in these sediments. Average rates of N2 production by denitrification and anammox (range 53–360 µmol N m−2 d−1) were comparable to those from Arctic and subarctic sediments worldwide (range 34–344 µmol N m−2 d−1). Anammox accounted for 18–26 % of the total N2 production. Absence of free hydrogen sulfide and low concentrations of dissolved iron in sediment pore waters suggested that denitrification and DNRA were driven by organic matter oxidation rather than chemolithotrophy. DNRA was as important as denitrification at a shallow, coastal station situated in the northern Bothnian Bay. At this pristine and fully oxygenated site, ammonium regeneration through DNRA contributed more than one third to the total dissolved nitrogen (TDN) diffusing from the sediment to the water column, and accounted, on average, for 45 % of total nitrate reduction. At the offshore stations, the proportion of DNRA in relation to denitrification was lower (0–16 % of total nitrate reduction). Median value and range of benthic DNRA rates from the GOB were comparable to those from the southern and central eutrophic Baltic Sea and other temperate estuaries and coasts in Europe. Therefore, our results contrast with the view that DNRA is negligible in cold and well-oxygenated sediments with low organic carbon loads. However, the mechanisms behind the variability in DNRA rates between our sites were not resolved. The GOB sediments were a major source (237 kt y−1, which corresponds to 184 % of the external N load) of fixed N to the water column through recycling mechanisms. To our knowledge, our study is the first to document the simultaneous contribution of denitrification, DNRA, anammox and TDN recycling combined with in situ measurements.