Mercury (Hg) compounds represent an important risk to aquatic ecosystems due to their persistence, bioaccumulation and biomagnification potential. In the present review, we critically examine the state-of-the-art studies concerning the interactions of Hg compounds with freshwater biofilms with emphasis on Hg accumulation, transformations and effects. Freshwater biofilms contain both primary producers (e.g. algae) and decomposers (e.g bacteria and fungi), which contribute to both aquatic food webs and microbial loop. Hence they play a central role in shallow water and streams, as well as contribute to Hg trophic transfer through their consumption. Both inorganic and methylated mercury compounds accumulate in biofilms, which could transform them mainly by methylation, demethylation and reduction. Accumulated Hg compounds could induce diverse metabolic and physiological perturbations in the microorganisms embedded in biofilm matrix and affect their community composition. The bioavailability of Hg compounds, their transformations and effects depend on their concentrations and speciation, ambient water characteristics, biofilm matrix composition- and microorganism-specific characteristics. Nonetheless, the basic processes governing the interactions of Hg compounds with biofilm constituents are understudied. Development of novel conceptual and methodological approaches allowing the understanding of the chemo- and biodynamic aspects is necessary to understand Hg cycling in the shallow water as well as to enable improved use of freshwater biofilms as potential indicator of water quality and to support better informed risk assessment.