The Eastern China Coastal Seas (ECCS), including the Yellow Sea (YS), Bohai Sea (BS), and East China Sea (ECS), are facing a variety of environmental problems, including mercury (Hg) pollution. Although methylmercury (MeHg) has been recognized as the most toxic Hg species in the environment, there is still a lack of knowledge on its cycling in the ECCS, limiting a sound understanding of Hg cycling and its potential risk in these regions. To address these needs, we investigated the distribution and methylation/demethylation of Hg in the ECCS during eight cruises. The observed complicated distribution pattern of MeHg suggested that in situ production/degradation may control MeHg concentrations in the ECCS. Incubation experiments indicated that photic and biotic methylation/demethylation occurred in seawater, whereas these two processes were mainly mediated by microorganisms in sediment. Sulfate reduction bacterial (SRB) and methanogens (MPA) were identified as the key microorganisms dominating biotic methylation and demethylation in both water and sediment. Ultraviolet (UV) was the major spectrum that causes photic methylation and demethylation in surface water. By quantifying the in situ production/degradation, along with river input and exchange with nearby seas, sediment was found to be the most important source of MeHg, while photic and biotic demethylation in water serves as the largest sink in the ECCS. In comparison with other marine systems, a relatively low ecosystem conversion efficiency of inorganic Hg to MeHg, i.e., low MeHg/THg ratios in the water, was observed in the ECCS. This may result from the low efficiency of transporting THg from water to the sediment, slow methylation in the sediment and water, and quick degradation in the water. The low conversion efficiency of inorganic Hg to MeHg may be one of the convincible reasons for the paradox that low Hg levels detected in ECCS organisms compared with higher Hg anthropogenic discharge and higher THg concentrations in seawater.