Hypoxia has occurred intermittently over the Holocene in the Baltic Sea, but the recent expansion from less than 10 000 km(2) before 1950 to > 60 000 km(2) since 2000 is mainly caused by enhanced nutrient inputs from land and atmosphere. With worsening hypoxia, the role of sediments changes from nitrogen removal to nitrogen release as ammonium. At present, denitrification in the water column and sediments is equally important. Phosphorus is currently buried in sediments mainly in organic form, with an additional contribution of reduced Fe-phosphate minerals in the deep anoxic basins. Upon the transition to oxic conditions, a significant proportion of the organic phosphorus will be remineralized, with the phosphorus then being bound to iron oxides. This iron-oxide bound phosphorus is readily released to the water column upon the onset of hypoxia again. Important ecosystems services carried out by the benthic fauna, including biogeochemical feedback-loops and biomass production, are also lost with hypoxia. The results provide quantitative knowledge of nutrient release and recycling processes under various environmental conditions in support of decision support tools underlying the Baltic Sea Action Plan.