The seasonal geochemical characteristics of the seawater and sediments and the major factors causing heavy metal contamination were investigated at the Youngil bay and the Hyungsan river estuary in the Southeast Coast of Korea, where a world-scale steel-industry complex (Pohang iron and steel industrial complex, POSCO) is located. The seasonal and spatial distribution characteristics of temperature, dissolved oxygen (DO), pH, and nutrients of the seawater were studied at 45 fixed stations, especially focusing on the river mouth area. Sediments at 27 stations were examined during winter and summer to determine the major controlling factors for the distribution of metals, using correlation matrix and R-mode factor analyses, and to evaluate the pollution status, using the modified geoaccumulation (I'_geo) index. Temperatures for the effluent from the POSCO located at the Hyungsan river mouth were 2-3 °C higher compared to other sampling areas, due to the thermal discharge from the POSCO. The DO concentration of the surface water at the Pohang old port was as low as 2-4 mg/L. In spring, the DO value at the Hyungsan river mouth was higher than 12 mg/L, by the mass multiplication of phytoplanktons at the river mouth where seawater temperature and nutrients concentrations were relatively high, resulting in the pH value of higher than 8.3. The nitrogen to phosphorus (N/P) ratios at the river mouth were 20-150 times higher compared to other areas, implying that the nitrogen loading into this semi-enclosed bay is significantly higher than phosphorus and the major nitrogen sources are not only the domestic sewage from the city but the industrial wastewater from the POSCO and other steel factories nearby. The phosphorus concentrations at the Pohang old port were shown 3-10 times higher than those at other stations, due to the inflow of pollutants generated from the nearby ships anchoring and the release of phosphate from the bottom sediment. Results from the sediment analysis showed that the major controlling factors for the distribution pattern of each metal are grain size and organic carbon (C_org) content. Based on the factor analysis, Al, Fe, Cr, Li, and Pb were shown strongly correlated with the mean grain size (Mz), whereas Cd, Cu, Zn, and Sn with the C_org content. Results from the fractionation of the sedimentary metals into lattice and labile fractions to characterize the mobility of sediment metals showed that the mineral lattice fraction was high in the order of Al = K > Cr > Li > Sr > Fe, while the labile fraction, which might be released to the overlying water, was in the order of Pb > Zn > Cd > Cu > Ca > Sn. Evaluation of the sediment pollution status by applying (I'_geo) of 13 metals showed Cd, Cu, and Zn as high as 1-3 range at the old port. Even though the overall marine pollution mainly by the world-class steel industrial complex in this semi-enclosed bay area studied does not currently pose a serious threat, due to the seawater circulation and the large influx of river discharge, the countermeasures to implement the sediments concentrated with heavy metals, especially at the old port with no seawater circulation, are still warranted for this coastal water environment. © 2008 Elsevier Ltd. All rights reserved.