The decline in anadromous rainbow smelt (Osmerus mordax) populations may be due to anthropogenic causes including spawning habitat degradation. The purpose of this study was to assess the survival of rainbow smelt embryos incubated under sediment layers of different depths (0.00, 0.25, 1.00, and 6.00 g/45.6 cm2) and in contact with periphyton communities of different biomass. Embryo survival was also assessed when cultured on periphyton in combination with sterilized sediment or eutrophying compounds (nitrates and phosphates). Oxygen consumption was monitored from embryos cultured alone, on periphyton layers, and under a sediment layer. Survival was significantly reduced under the highest sediment treatment and attributed to low oxygen availability to the embryos. Embryonic survival was also significantly reduced when incubated on the highest periphyton biomass. Embryos under the sediment layer consumed oxygen at a significantly greater rate than the controls, and the dissolved oxygen concentration below the sediment–water interface decreased to near anoxic. These results suggest that embryonic survival could be impacted in rivers with heavy sedimentation or a high standing biomass of periphyton.