Despite the research efforts to understand the fate and impact of mercury (Hg) in aquatic environments, the role of cyanobacteria in Hg biotransformations is poorly documented. The aim of the present work is to gain insight into the involvement of cyanobacteria in Hg transformations, speciation and bioavailability. A multidisciplinary approach, including the study of uptake kinetics of inorganic (iHg) and monomethyl (MMHg) mercury, biotic transformations using species-specific Hg isotopes and, characterization of Hg complexation was adopted. Results showed that Synechocystis sp. PCC6803 accumulated rapidly substantial amounts of Hg species and was able to demethylate the bioaccumulated MMHg. No methylation of iHg was found. The addition of thiols and dissolved organic matter decreased the Hg biouptake by Synechocystis sp. Pico-nanoplankton from a eutrophic lake demethylated the MMHg and demethylation yields were positively correlated with the abundance of diatoms and heterotrophs present in the communities, while the contribution of cyanobacteria was minor.