Vertical distributions of nitrogen contents, net nitrification rates, net N-mineralization rates and nitrate reductase activities in sediments of Lake Yuehu in June, 2005, were described on basis of four samples from the lake. The results showed that there was a critical layer in which exchangeable nitrate contents were the highest. Exchangeable ammonium and available nitrogen contents were the lowest in the subsurface sediment (5-10cm). Available nitrogen was stored mainly in the form of exchangeable ammonium in both surface (0-5cm deep) and deeper layers (>10cm deep) where their contents were higher. The pattern of this distribution can be explained by anaerobic conditions. The surface sediment not only showed higher contents of total nitrogen and organic nitrogen, rates of net nitrification, N-mineralization and nitrate reductase activities, but also displayed the highest ammonium and the lowest nitrate concentrations in interstitial water. Therefore, based on a nitrogen cycling mode, we proposed that organic nitrogen was re-mineralized to ammonium and nitrate with processes of the former being nitrified into the later, resulting in anaerobic conditions that contributed to ammonium accumulation by the production of its own and nitrate reduction in interstitial water of surface sediment. In general, the surface sediment in eutrophic lakes, enriched by organic nitrogen, is the most active dimension for the biogeochemical cycling of nitrogen with ammonium being the major and most effective forms.