For many glacial lakes with highly permeable sediments, water exchange rates control hydrologic residence times within the sediment‐water interface (SWI) and the removal of reactive compounds such as nitrate, a common pollutant in lakes and groundwater. Here we conducted a series of focused tracer injection experiments in the upper 20 cm of the naturally downwelling SWI in a flow‐through lake on Cape Cod, MA. We systematically varied residence time and reactant controls on nitrate processing, using isotopically labeled ¹⁵N nitrate to monitor the effect of these changes on nitrate removal via denitrification. The addition of acetate, a labile carbon compound, triggered the lake SWI to switch from net production to net removal of nitrate. When acetate was combined with increased residence time created by controlled reductions in water flux, we observed a fivefold increase in nitrate removal, a 26‐fold increase in N₂ production, and a 42‐fold increase in N₂O production. We demonstrate that water residence time is an important control on the fate of nitrate in these lake SWIs and illustrate that seasonal conditions that alter lake exchange rates and variability in lake carbon may predict dynamic nitrate removal across the SWI. Additionally, observed N₂O production during the oxic pore water experiments paired with geophysical characterization of the sediment porosity revealed that the lake SWI has less mobile pores occupying upward of 50% of the total porosity volume, which function as reactive microzones for nitrate processing.