Groundwater is essential for the provision of drinking water in many areas around the world. The performance of the groundwater-bearing aquifer relies on the ecosystem services provided by groundwater-related organisms. Therefore, if remediation of contaminated groundwater is necessary, the remediation method has to be carefully selected to avoid risk-risk trade-offs that might impact these ecosystems. In the present study, the environmental risk of the in situ remediation agent Carbo-Iron was performed. Carbo-Iron® is a composite of zero valent nano-iron and active carbon. Existing ecotoxicity data were complemented by studies with Daphnia magna (Crustacea), Scenedesmus vacuolatus (Algae), Chironomus riparius (Insecta) and nitrifying soil microorganisms. The predicted no effect concentration of 0.1 mg/L was derived from acute and chronic ecotoxicity studies. It was compared to measured and modelled environmental concentrations of Carbo-Iron applied in a groundwater contaminated with chlorohydrocarbons in a field study and risk ratios were derived. A comprehensive assessment approach was developed further based on existing strategies and used to identify changes of the environmental risk due to the remediation of the contaminated site with Carbo-Iron. With the data used in the present study, the total environmental risk decreased by approximately 50% in the heavily contaminated zones after the application of Carbo-Iron. Thus, based on the results of the present study, the benefit of remediation with Carbo-Iron seems to outweigh its negative effects on the environment.