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Assessing historical environmental conditions linked to habitat colonization is important for understanding long‐term resilience and improving conservation and restoration efforts. Such information is lacking for the seagrass Zostera marina, an important foundation species across cold‐temperate coastal areas of the Northern Hemisphere. Here, we reconstructed environmental conditions during the last 14,000 years from sediment cores in two eelgrass (Z. marina) meadows along the Swedish west coast, with the main aims to identify the time frame of seagrass colonization and describe subsequent biogeochemical changes following establishment. Based on vegetation proxies (lipid biomarkers), eelgrass colonization occurred about 2,000 years ago after geomorphological changes that resulted in a shallow, sheltered environment favoring seagrass growth. Seagrass establishment led to up to 20‐ and 24‐fold increases in sedimentary carbon and nitrogen accumulation rates, respectively. This demonstrates the capacity of seagrasses as efficient ecosystem engineers and their role in global change mitigation and adaptation through CO2 removal, and nutrient and sediment retention. By combining regional climate projections and landscape models, we assessed potential climate change effects on seagrass growth, productivity and distribution until 2100. These predictions showed that seagrass meadows are mostly at risk from increased sedimentation and hydrodynamic changes, while the impact from sea level rise alone might be of less importance in the studied area. This study showcases the positive feedback between seagrass colonization and environmental conditions, which holds promise for successful conservation and restoration efforts aimed at supporting climate change mitigation and adaptation, and the provision of several other crucial ecosystem services. Plain Language Summary: This study investigated the historical colonization of eelgrass (Zostera marina), an important marine vascular plant in cold‐temperate coastal regions. Sediment cores from eelgrass meadows on the Swedish west coast dating back as far as 14,000 years were examined to understand the time‐course of eelgrass colonization and the subsequent modification of the environment. We found that eelgrass colonization began approximately 2,000 years ago, coinciding with the development of shallow, sheltered conditions that favored eelgrass growth. As eelgrass became established, this led to substantial habitat and sediment changes, including a 20‐ and 24‐fold increase in carbon and nitrogen accumulation, respectively. This highlights the crucial role of eelgrass as a provider of important ecosystem services, such as regulation of climate, nutrient retention, and sediment protection. We also examined the potential effects of climate change on eelgrass growth and health, predicting that decreased water clarity and altered water flow pose the greatest risks. Overall, this study adds valuable insights into the relationship between eelgrass and its environment, aiding in conservation and restoration efforts to mitigate climate change and maintain essential ecosystem services. It emphasizes the importance of specific environmental conditions for successful eelgrass colonization and restoration. Key Points: Decreased hydrodynamics and water depth created a favorable environment for eelgrass establishment about 2,000 years agoCarbon and nitrogen burial increased in order of magnitudes following seagrass colonizationPaleoecological information on environmental conditions linked to seagrass colonization can aid conservation and restoration efforts [ABSTRACT FROM AUTHOR]