The Kuh e Dena sedimentary section in Iran developed on the southwestern margin of the Neotethys Ocean. The fossil- and bioturbation-lean Early Triassic section (Late Dienerian to Early Smithian) is typified by finely laminated calcareous shales that are interbedded with laterally extending carbonate beds, which are mostly composed of calyx-shaped carbonate crystal fans. The calyxes consist of fibrous crystals that apparently formed within the subseafloor in soft, water-saturated sediment by displacive growth. Rare earth element and yttrium patterns indicate that calyx-shaped crystals precipitated from anoxic pore waters. Biomarker patterns of the carbonate beds reveal major input of lipids from prokaryotes that typically occur within layered benthic microbial mats (i.e., cyanobacteria, anoxygenic phototrophic bacteria, sulphate-reducing bacteria, and methanogenic archaea). Along their length, the fibrous crystals of the calyxes reveal a trend of increasing δ13Ccarb values (from 2.7 to 3.3‰), suggesting that archaeal methanogenesis affected the carbonate pool. Apart from the putative benthic prokaryotes, molecular fossils of halophilic, most likely planktic, archaea were detected in the carbonate beds. Low pristane to phytane ratios (≤0.8) and the presence of halophilic archaea are in accord with the lack of bioclasts and bioturbation, which likely reflects increased salinities. The former presence of a benthic microbial mat with cyanobacteria underlain by anoxygenic phototrophic bacteria, sulphate-reducing bacteria, and methanogenic archaea is in accordance with studies on living microbial mats in hypersaline, low-oxygen marine environments. The Early Triassic subseafloor seems to have been a sink for carbon, driven by biologically-induced formation of secondary, diagenetic carbonate.