European settlement and drought have significantly impacted the hydrology of the Coorong, a shallow coastal lagoon complex in South Australia, which is part of a terminal wetland at the mouth of the River Murray. An increased salinity associated with lower water levels and progressive isolation from ocean flushes contributed to a severe decline in ecological diversity over the past decades. Here we have conducted a molecular and stable isotopic study of a sedimentary core from the northern Coorong Lagoon spanning more than 5000years to investigate the recent palaeoenvironmental history of the ecosystem. Major alterations were evident in many biogeochemical parameters in sediments deposited after the 1950s coinciding with the beginning of intensified water regulations. The most prominent shift occurred in δ13C profiles of C21-C33 n-alkanes from average values of -23.5‰ to an average of -28.2‰. Further changes included decreases in carbon preference index (CPI) and average chain length (ACL) of the n-alkane series as well as significant increases in algal (e.g. C20 HBI, long chain alkenes and C29-alkadiene) and bacterial (e.g. 13C depleted short chain n-alkanes and hopanoids, δ13C: -35.9‰ to -30.1‰) derived hydrocarbons. Long chain n-alkanes with a strong odd/even predominance as observed here are typically attributed to terrigenous plants. In the Coorong however, terrigenous input to sedimentary OM is only minor. Therefore changes in the before mentioned parameters were attributed to a source transition from a major contribution of macrophytes towards predominantly microalgae and bacteria.δD values of C21-C33 n-alkanes showed a general trend towards more enriched values in younger sediments, indicating an overall rising salinity. However, the most pronounced positive shift in these profiles again occurred after the 1950s. Altogether this study demonstrates that the recent human induced changes of the Coorong hydrology, compounded by a severe drought led to an increase in salinity and alterations of primary production which have been much more significant than natural variations occurring throughout the Holocene over several thousands of years. © 2014 Elsevier Ltd.