San Pablo Bay is an estuary, within northern San Francisco Bay, containing elevated sediment mercury (Hg) levels because of historic loading of hydraulic mining debris during the California gold-rush of the late 1800s. A preliminary investigation of benthic microbial Hg cycling was conducted in surface sediment (0–4 cm) collected from one salt-marsh and three open-water sites. A deeper profile (0–26 cm) was evaluated at one of the open-water locations. Radiolabeled model Hg-compounds were used to measure rates of both methylmercury (MeHg) production and degradation by bacteria. While all sites and depths had similar total-Hg concentrations (0.3–0.6 ppm), and geochemical signatures of mining debris (as εNd, range: –3.08 to –4.37), in-situ MeHg was highest in the marsh (5.4±3.5 ppb) and ≤0.7 ppb in all open-water sites. Microbial MeHg production (potential rate) in 0–4 surface sediments was also highest in the marsh (3.1 ng g^–1 wet sediment day^–1) and below detection (<0.06 ng g^–1 wet sediment day^–1) in open-water locations. The marsh exhibited a methylation/demethylation (M/D) ratio more than 25× that of all open-water locations. Only below the surface 0–4-cm horizon was significant MeHg production potential evident in the open-water sediment profile (0.2–1.1 ng g^–1 wet sediment day^–1). In-situ Hg methylation rates, calculated from radiotracer rate constants, and in-situ inorganic Hg(II) concentrations compared well with potential rates. However, similarly calculated in-situ rates of MeHg degradation were much lower than potential rates. These preliminary data indicate that wetlands surrounding San Pablo Bay represent important zones of MeHg production, more so than similarly Hg-contaminated adjacent open-water areas. This has significant implications for this and other Hg-impacted systems, where wetland expansion is currently planned.