More than 2 y have passed since the BP-Deepwater Horizon oil spill in the Gulf of Mexico, yet we still have little understanding of its ecological impacts. Examining effects of this oil spill will generate much-needed insight into how shoreline habitats and the valuable ecological services they provide (e.g., shoreline protection) are affected by and recover from large-scale disturbance. Here we report on not only rapid salt-marsh recovery (high resilience) but also permanent marsh area loss after the BP-Deepwater Horizon oil spill. Field observations, experimental manipulations, and wave-propagation modeling reveal that (i) oil coverage was primarily concentrated on the seaward edge of marshes; (ii) there were thresholds of oil coverage that were associated with severity of salt-marsh damage, with heavy oiling leading to plant mortality; (iii) oil-driven plant death on the edges of these marshes more than doubled rates of shoreline erosion, further driving marsh platform loss that is likely to be permanent; and (iv) after 18 mo, marsh grasses have largely recovered into previously oiled, noneroded areas, and the elevated shoreline retreat rates observed at oiled sites have decreased to levels at reference marsh sites. This paper highlights that heavy oil coverage on the shorelines of Louisiana marshes, already experiencing elevated retreat because of intense human activities, induced a geomorphic feedback that amplified this erosion and thereby set limits to the recovery of otherwise resilient vegetation. It thus warns of the enhanced vulnerability of already degraded marshes to heavy oil coverage and provides a clear example of how multiple human-induced stressors can interact to hasten ecosystem decline.