Mercury (Hg) is a global pollutant threatening our water resources and human health. Every one of us contains some levels of Hg or methylmercury (MeHg) in our body due to consumption of contaminated food such as fish and rice. Our understanding of the behavior of Hg in natural aquatic environments is limited as the major factors controlling microbial uptake and conversion of inorganic Hg to neurotoxic MeHg remain obscure. MeHg concentrations in water can bioaccumulate up to eight orders of magnitude in the food chain. Metallic or elemental Hg can evaporate and transport around the globe, and also readily undergoes chemical, photochemical and biological transformations (i.e., oxidation, reduction, methylation and demethylation) in water and sediments. Natural dissolved organic matter (DOM) plays a critical role in mediating these transformations because of its exceptionally strong binding affinity for Hg and its dual functional roles in reducing and oxidizing Hg. While the discovery of Hg-methylation genes significantly advanced our understanding of MeHg biosynthesis, the simultaneous degradation of MeHg at low concentrations (i.e., picomolar to nanomolar) by a range of methanotrophic and anaerobic bacteria has recently been recognized possibly as an important process for controlling net MeHg production, a key factor that determines Hg concentrations and bioaccumulation in biota. Although treatment technologies for Hg removal from water are available, they are mostly applicable to industrial waste streams and at localized contamination sites with high Hg concentrations (i.e., micromolar to millimolar). Reductions in Hg human exposure may be achievable by decreasing anthropogenic releases, such as coal combustion, over the long-term since Hg methylation responds to Hg inputs, particularly freshly deposited Hg in natural aquatic systems.