Coastal sediments in sheltered temperate locations are strongly modified by ecosystem engineering species such as marsh plants, seagrass, and algae as well as by epibenthic and endobenthic invertebrates. These ecosystem engineers are shaping the coastal sea and landscape, control particulate and dissolved material fluxes between the land and sea, and between the benthos and the passing water or air. Above all, habitat engineering exerts facilitating and inhibiting effects on biodiversity. Despite a strongly growing interest in the functional role of ecosystem engineering over the recent years, compared to food web analyses, the conceptual understanding of engineering-mediated species interactions is still in its infancy. In the present paper, we provide a concise overview on current insights and propose two hypotheses on the general mechanisms by which ecosystem engineering may affect biodiversity in coastal sediments. We hypothesise that autogenic and allogenic ecosystem engineers have inverse effects on epibenthic and endobenthic biodiversity in coastal sediments. The primarily autogenic structures of the epibenthos achieve high diversity at the expense of endobenthos, whilst allogenic sediment reworking by infauna may facilitate other infauna and inhibits epibenthos. On a larger scale, these antagonistic processes generate patchiness and habitat diversity. Due to such interaction, anthropogenic influences can strongly modify the engineering community by removing autogenic ecosystem engineers through coastal engineering or bottom trawling. Another source of anthropogenic influences comes from introducing invasive engineers, from which the impact is often hard to predict. We hypothesise that the local biodiversity effects of invasive ecosystem engineers will depend on the engineering strength of the invasive species, with engineering strength defined as the number of habitats it can invade and the extent of modification. At a larger scale of an entire shore, biodiversity need not be decreased by invasive engineers and may even increase. On a global scale, invasive engineers may cause shore biota to converge, especially visually due to the presence of epibenthic structures.