Yundang Lake is an important area for living and traveling in Xiamen Island. Severe pollution and sedimentation have been found in the lake, and then the dredging is needed. In order to assess the pollution level of dredged material, sediments from 6 stations in the Yundang Lake were sampled for heavy metal contamination, speciation analysis, and adsorption-desorption experiment in April 2003. Heavy metals concentrations varied from 21.96~848.38 mg/kg for Cu, 51.11~398.25 mg/kg for Pb, 121.60~4301.25 mg/kg for Zn, 0.00~14.71 mg/kg for Cd and 0.70~31.18 mg/kg for total Hg, respectively. The average concentrations of metals (Cu, Zn, Cd, and total Hg) are almost much higher than the secondary standard criteria of national marine sediment quality. According to the mean values of pollution index (Pi), the order of pollution level for heavy metals is as following: Hg >Cd >Zn >Cu >Pb. The results from the concentrations and Pi values of selected metals suggest that the study area has been significantly contaminated with heavy metals, and the plan that transferring dredged material to the dumping area must be forbidden. Similar chemical fractionation distribution for each metal is found in the outer lake and Songbai Lake, except for Hg. The main fraction for selected metals is the residual species, except for Cd in station Y17. It indicates that those heavy metals exhibit low biological availability in study area. Both speciation analysis and adsorption-desorption experiment show that the effects on the heavy metals in disposal area resulting from dredging at the Yundang Lake are not significant and the dredged material is fit to be stored at the reclamation region.