The microbial metabolism of organic matter (OM) in seagrass beds can create sulfidic conditions detrimental to seagrass growth; iron (Fe) potentially has ameliorating effects through titration of the sulfides and the precipitation of iron-sulfide minerals into the sediment. In this study, the biogeochemical effects of Fe availability and its interplay with sulfur and OM on sulfide toxicity, phosphorous (P) availability, seagrass growth and community structure were tested. The availability of Fe and OM was manipulated in a 2 × 2 factorial experiment arranged in a Latin square, with four replicates per treatment. The treatments included the addition of Fe, the addition of OM, the addition of both Fe and OM as well as no addition. The experiment was conducted in an oligotrophic, iron-deficient seagrass bed. Fe had an 84.5% retention efficiency in the sediments with the concentration of Fe increasing in the seagrass leaves over the course of the experiment. Porewater chemistry was significantly altered with a dramatic decrease in sulfide levels in Fe addition plots while sulfide levels increased in the OM addition treatments. Phosphorus increased in seagrass leaves collected in the Fe addition plots. Decreased sulfide stress was evidenced by heavier δ34S in leaves and rhizomes from plots to which Fe was added. The OM addition negatively affected seagrass growth but increased P availability; the reduced sulfide stress in Fe added plots resulted in elevated productivity. Fe availability may be an important determinant of the impact that OM has on seagrass vitality in carbonate sediments vegetated with seagrasses.