In aquatic habitats, micro-organisms successfully adhere to and mediate particles, thus changing the erosive response of fine sediments to hydrodynamic forcing by secreting glue-like extracellular polymeric substances (EPS). Because sediment dynamics is vital for many ecological and economic aspects of watersheds and coastal regions, biostabilization of cohesive sediments is one of the important ecosystem services provided by biofilms. Although the research on biostabilization has gained momentum over the last 20 years, we still have limited insights principally due to the complex nature of this topic, the varying spatial, temporal, and community scales examined, oversimplified ecohydraulic experiments with little natural relevance, and the often partial views of the disciplines involved. This review highlights the current state of our knowledge on biostabilization and identifies important areas for future research on: (A) the influence of abiotic conditions on initial colonization and subsequent biofilm growth, focusing on hydrodynamics, substratum, salinity, nutrition, and light climate; (B) the response of microbes in terms of physiological activity and species diversity to environmental settings as well as biotic conditions such as competition and grazing; and (C) the effects of the former on the EPS matrix, its main constituents, their composition, functional groups/substitutes, and structures/linkages. The review focuses specifically on how the numerous mutual feedback mechanisms between abiotic and biotic conditions influence microbial stabilization capacity, and thus cohesive sediment dynamics.