Here we describe the potential for sediment microbial nitrogen-cycling gene (DNA) and activity (RNA) abundances to spatially resolve coastal areas impacted by seasonal variability in external nutrient inputs. Three sites were chosen within a nitrogen-limited embayment, Port Phillip Bay (PPB), Australia that reflect variability in both proximity to external nutrient inputs and the dominant form of available nitrogen. At three sediment depths (0–1; 1–5; 5–10 cm) across a 2 year study key genes involved in nitrification (archaeal amoA and bacterial β-amoA), nitrite reduction (clade I nirS and cluster I nirK, archaeal nirK-a), anaerobic oxidation of ammonium (anammox 16S rRNA phylogenetic marker) and nitrogen fixation (nifH) were quantified. Sediments impacted by a dominance of organic nitrogen inputs were characterised at all time-points and to sediment depths of 10 cm by the highest transcript abundances of archaeal amoA and archaeal nirk-a. Proximity to a dominance of external nitrate inputs was associated with the highest transcript abundances of nirS which temporally co-varied with seasonal changes in sediment nitrate. Sediments isolated from external inputs displayed the greatest depth-specific decrease in quantifiable transcript abundances. In these isolated sediments bacterial β-amoA transcripts were temporally associated with increased sediment ammonium levels. Across this nitrogen limited system variability in the abundance of bacterial β-amoA, archaeal amoA, archaeal nirk-a or nirS transcripts from the sediment surface (0–1 and 5 cm) demonstrated a capacity to improve our ability to monitor coastal zones impacted by anthropogenic nitrogen inputs. Specifically, the spatial detection sensitivity of bacterial β-amoA transcripts could be developed as a metric to determine spatiotemporal impacts of large external loading events. This temporal study demonstrates a capacity for microbial activity metrics to facilitate coastal management strategies through greater spatial resolution of areas impacted by external nutrient inputs.