The role of benthic sandy ecosystems in mitigating NO3− loads carried by Submarine Groundwater Discharge (SGD) to coastal marine ecosystems is uncertain. Benthic biogeochemical mediation of NO3−-rich submarine groundwater discharge was studied at the seepage face of a barrier island site in the Ria Formosa coastal lagoon (Southern Portugal). Preliminary analysis of NO3− porewater distributions at the seepage face during discharge indicated that benthic biogeochemical processes could significantly affect the fluxes of groundwater-borne NO3− into the lagoon. In order to discriminate between the relative contribution of transport and reaction processes to shape and concentration range evidenced by in-situ porewater NO3− gradients, an advection-dispersion-reaction (ADR) model of NO3− diagenesis was applied to describe NO3− porewater profiles obtained in March, June, September and December 2006. Good agreement between modeled and measured profiles was obtained. Model-derived apparent benthic nitrification and NO3− reduction rates ranged from 0.01 to 5.2 mmol m−2 h−1, sufficient to explain gross observed changes in NO3− fluxes arriving at the seepage face (up to 70% within the surficial 20 cm depth layer). Results of the analysis indicated that the upper limit of the seepage face promoted mitigation of NO3− fluxes to the lagoon throughout the year. In contrast, the lower limit of the seepage area promoted net amplification of the NO3− fluxes into the lagoon in June and September. These results will help constrain further work aiming to clarify the role of permeable sediments in mitigating nitrogen loading of coastal ecosystems.