Low molecular weight (LMW) compounds are key intermediates in organic matter degradation and their metabolism supports a diverse microbial community in anoxic sediments. Much remains to be learned about the metabolic pathways and turnover rates of LMW compounds as well as the factors that influence their metabolism in the environment. We studied the microbial metabolism of acetate, methanol and methylamine in sediments from Northern Gulf of Mexico to elucidate their role as energy and carbon sources for microorganisms mediating terminal metabolic processes and to constrain the importance of C1 and C2 metabolism in the sedimentary carbon cycle. In terms of carbon flow, methanogenesis was a minor process in sulfate-rich sediments; acetate and methanol were oxidized primarily by non-methanogenic heterotrophs as an energy source. A large fraction of utilized acetate (20–76%) was assimilated into biomass, suggesting that acetate was a significant biomass-building source. In situ thermodynamic calculations suggested the utilization of acetate and methanol by sulfate-reducing bacteria was more favorable than the utilization by methanogens, consistent with the observed higher oxidation rates than methanogenesis rates as well as results from inhibitor experiments employing 2-bromoethanesulfonate and molybdate. Methylamine, by contrast, was utilized for methane production (up to 100%), but its utilization was not limited to methanogens. At an organic-poor deep-sea site, elevated acetate and methanol oxidation rates in the absence of sulfate-reducing and methanogenic activity indicated that metabolism of LMW compounds was coupled to other electron accepting processes, such as denitrification. Heterotrophic carbon assimilation was an important pathway for generating biomass at this site, as evidenced by comparable rates of acetate assimilation to bicarbonate incorporation. The oxidation and assimilation rates of LMW compounds generally decreased with sediment depth, following the trend of organic carbon degradation rates. Environmental factor, such as temperature but not pressure, affected the metabolism of LMW compounds; the oxidation of acetate, methanol and methylamine exhibited distinct responses to changes in temperature. In seep sediments, the oxidation of acetate and methanol accounted for 5% and 0.9%, respectively, of the total organic carbon oxidation. Collectively, this assessment of C1 and C2 LMW compound utilization shows that these compounds serve as energetic substrates to fuel methanogens, sulfate reducers and other microbes.