The main aim of this study is to analyze the influence of 4-nonylphenol (NP) on soil water retention and biological activity. Two doses of 4-nonylphenol (25 and 50 mg kg−1) were tested in a loam soil with and without peat amendment. In general, one week after the start of the experiment, the soil water content retained at −0.75 MPa of soil suction was 18% higher in the soil amended and its basal respiration (BR) was 15% higher than soil without peat. In contrast, the microbial activity indices (CM: coefficient of mineralization or BR:total organic carbon (TOC) ratio; Cmic:Corg: microbial biomass carbon (MBC):TOC ratio; qCO2: metabolic quotient or BR:MBC ratio) were higher in the soil without peat, compared to the soil amended with peat. On the other hand, the addition of NP to soil was able to modify soil biological but not physical (water retention, desorption) properties. When soil was amended with peat, MBC was reduced one week after applying NP. In contrast, no effects of NP on MBC were observed in the soil without peat. BR was reduced by 16% one week after applying 50 mg kg−1 of NP to soil with peat, and was increased by 46% one week after applying 25 mg kg−1 of NP to soil without peat. The effects of NP on MBC and BR could be associated more with the adsorption of NP by soil organic matter, while changes in CM or Cmic:Corg ratio were more closely related to changes in soil water retention. The potential toxic effects of NP (high qCO2 values) were only observed in the absence of peat amendments. Peat addition reduced NP toxic effects on microorganisms.