Along the Louisiana, USA continental shelf, sandy shoals are shallow, possibly oxygen-rich "islands" surrounded by deeper muddy deposits prone to hypoxia. Shoals also contain significant quantities of fine sand that may be mined in the future for coastal restoration. The ecological role of shoals remains poorly understood and we hypothesized that shoals provide critical habitat for benthic invertebrates. Using Ship Shoal as a model system, we assessed the diversity and structure of macrobenthic assemblages and how community structure varies with season and environmental parameters. High biomass (averaging 26.7 g m(-2)) and high diversity (161 species) of macrobenthos was found in 2006. Polychaetes (45%-72 species) and crustaceans comprised most of the species (28%-46 species); spionids and amphipods dominated the polychaete and crustacean groups respectively, both in terms of number of species and abundances. Sharp decreases in diversity, abundance and biomass occurred from spring to autumn. Species diversity and total abundance significantly increased with decreasing sediment grain size and increasing bottom water dissolved oxygen. Across seasons, mole crabs Albunea paretii and amphioxus Branchiostoma floridae typified the community and contributed most of the biomass. The polychaetes Nephtys simoni, Neanthes micromma, Dispio uncinata, Mediomastus californiensis and Magelona sp. A, the amphipod Acanthohautorius sp. A and the burrowing shrimp Ogyrides alphaerostris also contributed to variation in community composition. Cluster analyses quantified seasonal variation, mainly based on sharp decreases in abundance, as well as spatial differences in species composition oriented along both east-west and north-south gradients. Variation in benthic assemblages was correlated with water depth and sediment characteristics (mean grain size and percentage of gravel-sized shell debris). We conclude that Ship Shoal is an unrecognized biodiversity hotspot and a hypoxia refuge compared to the immediate surrounding area where the benthic community is affected by seasonal hypoxia events and we discuss how sand-mining may influence this community.