Modern agriculture has accelerated biological methane and nitrogen cycling on a global scale. Freshwater sediments often receive increased downward fluxes of nitrate from agricultural runoff and upward fluxes of methane generated by anaerobic decomposition. In theory, prokaryotes should be capable of using nitrate to oxidize methane anaerobically, but such organisms have neither been observed in nature nor isolated in the laboratory. Microbial oxidation of methane is thus believed to proceed only with oxygen or sulphate. Here we show that the direct, anaerobic oxidation of methane coupled to denitrification of nitrate is possible. A microbial consortium, enriched from anoxic sediments, oxidized methane to carbon dioxide coupled to denitrification in the complete absence of oxygen. This consortium consisted of two microorganisms, a bacterium representing a phylum without any cultured species and an archaeon distantly related to marine methanotrophic Archaea. The detection of relatives of these prokaryotes in different freshwater ecosystems worldwide indicates that the reaction presented here may make a substantial contribution to biological methane and nitrogen cycles.