Galaxolide (HHCB) is used as a fragrance ingredient in household and personal care products, and has been ubiquitously detected in the environment. Here we investigated the fate of HHCB in subtropical freshwater microcosms, and evaluated effects of sediment-associated HHCB on a biological community consisting of algae, Daphnia, benthic macroinvertebrates and bacteria. The concentrations of sediment-associated HHCB did not change significantly during a 28 days exposure period, but HHCB accumulated in worms with biota-sediment accumulation-factor (BSAF) values in the range of 0.29–0.66 for Branchiura sowerbyi and 0.94–2.11 for Limnodrilus hoffmeisteri. There was no significant effects of HHCB (30 μg/g dry weight (dw) sediment) on chlorophyll-a content, sediment bacterial community composition, and survival and growth of benthic macroinvertebrates. However, the presence of benthic macroinvertebrates altered the sediment bacterial community structure relative to microcosms without introduced organisms. The findings of this study suggest that a single high-dose of HHCB, over 28 days, at environmentally relevant concentrations would not impose direct toxicological risks to aquatic organisms such as benthic macroinvertebrates.