The microbial reduction of N2O serves as a “gatekeeper” for N2O emissions, determining the flux of N2O release into the atmosphere. Estuaries are active regions for N2O emissions, but the microbial functions of N2O-reducing bacteria in estuarine ecosystems are not well understood. In this study, the 15N isotope tracer method, qPCR, and high-throughput sequencing were used to analyze N2O production, reduction, and emission processes in surface sediments of the Pearl River Estuary. The 15N isotope tracer experiment showed that the N2O production rates declined and the N2O reduction potential (Rr, the ratio of N2O reduction rates to N2O production rates) increased from upstream to downstream of the Pearl River Estuary, leading to a corresponding decrease of the N2O emission rates from upstream to downstream. The gene abundance ratio of nosZ/nir gradually increased from upstream to downstream and was negatively correlated with the water N2O saturation. The gene abundance of nosZ II was significantly higher than that of nosZ I in the estuary, and the nosZ II/nosZ I abundance ratio was positively correlated with N2O reduction potential. Furthermore, the community composition of NosZ-I- and NosZ–II–type N2O-reducing bacteria shifted from upstream to downstream. NosZ–II–type N2O-reducing bacteria, especially Myxococcales, Thiotrichales, and Gemmatimonadetes species, contributed to the high N2O reduction potential in the downstream. Our results suggest that NosZ–II–type N2O-reducing bacteria play a dominant role in determining the release potential of N2O from sediments in the Pearl River Estuary. This study provides a new insight into the function of microbial N2O reduction in estuarine ecosystems. Display omitted •The N2O reduction potential increased from upstream to downstream in the PRE.•nosZ II/nosZ I ratio positively correlated with N2O reduction potential.•The community of N2O-reducing bacteria shifted from the upstream to downstream.•NosZ–II–type N2O-reducing bacteria determined the N2O release potential in the PRE.