Increased periods of prolonged droughts followed by severe precipitation events are expected throughout South America due to climate change. Freshwater sediments are especially sensitive to these changing climate conditions. The increased oscillation of water levels in aquatic ecosystems causes enhanced cycles of sediment drying and rewetting. Here we experimentally evaluate the effects of induced drought followed by a rewetting event on the release of carbon dioxide (CO2), methane (CH4), nutrients (nitrogen and phosphorus), and trace elements (iron, manganese, and zinc) from the sediment of a tropical reservoir in southeastern Brazil. Furthermore, we used bulb onions (Allium cepa) to assess the potential cytogenotoxicity of the water overlying sediments after rewetting. We found peaks in CO2 and CH4 emissions when sediments first transitioned from wet to dry, with fluxes declining as sediments dried out. CO2 emissions peaked again upon rewetting, whereas CH4 emissions remained unaltered. Our experiment also revealed average increases by up to a factor of ~5000 in the release rates of nutrients and trace elements in water overlying sediments after rewetting. These increased release rates of potentially toxic compounds likely explain the lower replication of Allium cepa cells (up to 22% reduction) exposed to water overlying sediments after rewetting. Our findings suggest that increased events of drought followed by rewetting may lead to a range of changes in freshwater ecosystems, including nutrient enrichment, increased toxicity following resuspension of contaminants, and higher emission of greenhouse gases to the atmosphere.