The interaction of chemical dispersants and suspended sediments with crude oil influences the fate and transport of oil spills in coastal waters. A wave tank study was conducted to investigate the effects of chemical dispersants and mineral fines on dispersion of oil, formation of oil-mineral-aggregates (OMAs), and microbial activities in natural seawater. Results of ultraviolet fluoremetry (UVF) and gas chromatography-flame ionized detector (GC-FID) analysis indicate that both dispersants and mineral fines, alone and in combination, stimulate the dispersion of oil slick from surface to water column. A laser in-situ scattering and transsiometer (LISST-100X) measurement shows that the presence of mineral fines increased the total concentration of the suspended particles from 4 to 10 μL/L, whereas the presence of dispersants decreased the particle size (mass mean diameter) from 50–70 to 20 μm. Enumeration with epifluorescent microscope shows that the presence of either dispersants or mineral fines significantly increased the number of particles in water.