Background and aims <p>Irrigation and fertilization are critical for soil nitrogen cycling and microbial communities. This study explores the effects of muddy water film hole irrigation with sand-laden water from the Yellow River on soil nitrogen dynamics, microbial communities, and winter wheat productivity.</p> Methods <p>An orthogonal experiment tested combinations of sand content (3%, 6%, 9%), irrigation levels (0.5–0.65, 0.6–0.75, 0.7–0.85 FC), and nitrogen rates (100, 160, 220&#xa0;kg·hm⁻²), with conventional practices as controls. The study examined water and nitrogen management effects on soil nutrients, microbial communities, and nitrogen cycling in winter wheat.</p> Results <p>(1) Optimized water and nitrogen management improved soil nitrogen availability and functional gene expression (e.g., <i>glnA</i>, <i>nifK</i>, <i>amoC</i>). The <i>glnA</i> gene correlated strongly with yield (<i>R</i>² = 0.824). (2) Ammonium nitrogen (NH₄⁺-N) positively correlated with yield (<i>R</i>² = 0.81) and nitrogen use efficiency, emphasizing its role in nitrogen transformation. (3) Optimized treatments increased microbial diversity and activity of key groups (e.g., <i>Sphingomonas</i>, <i>Lysobacter</i>), enhancing nitrogen processes. (4) The T5 treatment (6% sand content, 0.6–0.75 FC, 160&#xa0;kg·hm⁻²) increased yield by 24.74% and nitrogen efficiency by 2.5 times, improving soil and microbial conditions.</p> Conclusions <p>Nitrogen-cycling genes (e.g., <i>glnA</i>, <i>nirK</i>) and ammonium nitrogen are central to soil nitrogen dynamics and crop productivity. These findings guide sustainable winter wheat cultivation in the Yellow River Basin.</p>