Since the 1997 local ban on ocean dumping of dredged sediments, the state of New Jersey has pursued a policy of environmentally sound solutions to the controversial problem of dredged material management, including beneficial use of dredged material stabilized with pozzolanic additives (SDM). A pilot study was initiated in 1998 to evaluate the use of SDM in the construction of highway embankments. Using 80,000 cubic yards of silty dredged material, 2 embankments were constructed from SDM on a commercial development area adjacent to the New York/New Jersey Harbor. This article presents the evaluation of the environmental effects of the SDM, including fugitive air emissions, leachate, and stormwater quality. Engineering properties, handling and management techniques of the SDM, constructability, and performance were also evaluated, the results of which are published elsewhere. The findings demonstrate that although there are measurable releases of contaminants to the environment from the SDM, these releases are not significant long-term threats to human health or the environment. Policies currently in place to regulate the management of SDM that include limiting placement options to previously contaminated sites with institutional and engineering controls will further reduce the potential for environmental impact and, in fact, have the potential to produce significant environmental benefit.