Sulfide is a toxic and corrosive product of sulfate-reducing bacteria that can accumulate in oily waste streams to nuisance levels. Sludge associated with an oily waste stream was collected from a settling tank and used to assess sulfide generation activities. Methanogenesis was a predominant process in sludge in the absence of sulfate, and was suppressed by nitrate. Sulfate reduction and sulfide formation were evident when sulfate was available. Nitrate diminished sulfate reduction and prevented sulfide accumulation under freshwater, brackish, and saltwater conditions. Sodium-, potassium-, and calcium nitrate were equally effective in curtailing sulfide formation. The effects of nitrate on sulfate depletion were concentration-dependent, with 50 mM nitrate diminishing sulfate reduction, yet as little as 16 mM nitrate prevented sulfide accumulation. Sulfide was oxidized in nitrate-reducing incubations, and accumulation of sulfur or sulfate was observed. Nitrate reduction was accompanied by production of nitrite and nitrous oxide, which probably helped prevent sulfate reduction in extended incubations. Our results suggest that nitrate amendments control the formation of sulfide in oily waste streams both by preventing sulfate reduction and by stimulating anaerobic sulfide oxidation.