Dramatic climatic and environmental changes over the last 12,000 years have significantly impacted Arabian coastal stratigraphy and human populations. The Bar Al Hikman peninsula (BAH), the largest low-lying area (1000 km2) along the Arabian Sea coast of Oman is a monsoon storm-dominated carbonate-evaporite system, where late Neolithic artifacts suggest human presence from at least 5.75–5.05 ka before the present (BP). Despite its archaeological significance at the crossroads of important Neolithic coastal sites in Dhofar, Masirah, and Ja'alan coast, paleoenvironmental interpretation, timing, and expression of relative sea level (RSL) changes in this coastal area remain poorly understood. Fortunately, the extensive size and arid climate of the area have preserved carbonate-dominated Mid-Late Holocene coastal geomorphologies exceptionally well, making this area an excellent geological archive to study past coastal environments, thereby understanding how environmental changes at BAH influenced Neolithic human mobility and settlement patterns. This study reconstructs the paleoenvironment of BAH over the last 12,000 years using a combination of field and remote sensing techniques, including satellite imagery, digital elevation models, bathymetric data, GIA modeling, and Sea Level Index Points to trace RSL history. The Holocene transgression began flooding the extensive continental shelf offshore BAH around 10 ka BP, progressively separating Masirah from the mainland through channel formation between 9.5 and 8.0 ka BP. It then inundated the present-day BAH peninsula around 7.7 ka BP, reaching a highstand of 2.5–3.2 m above present sea level by 6.0 ka BP (Mid-Holocene Highstand; MHHS), before gradually declining to the current level. Human presence documented at BAH (5.75–5.05 ka BP) coincides with the end of the mid-Holocene highstand, and the onset of the regression. This relative sea level history is contemporaneous to the aridification of Arabia, a period of transition from mangrove-dominated intertidal settings to coral reef and carbonate coastal barriers. The disappearance of mangrove-like gastropods around 5.4 cal ka BP and the subsequent appearance of significant coral fragments in the sediment indicates a critical change in terms of environmental settings with less nutrients and a warmer sea surface temperature). Comparing the findings at BAH to well-established nearby Neolithic sites on Masirah Island, the scarcity of prehistoric remains at BAH suggests that during the Mid-Holocene Highstand (MHHS), the small, rocky, paleo-low-lying islands at BAH may have served as waypoints and shelters between Masirah and the mainland.