Parameter estimation in the sediment deposition and resuspension process is an important issue in numerical modeling of suspended sediment transport. The sediment settling velocity and resuspension rate are two critical parameters controlling the sediment exchange process between the water column and sediment bed. In this paper a variational inverse data assimilation scheme for estimation of the sediment settling velocity and resuspension rate is developed and tested with a three-dimensional cohesive sediment transport model. The sediment settling velocity and resuspension rate are treated as poorly known parameters in the model and are estimated by the variational inverse scheme using an adjoint approach. A limited-memory quasi-Newtonian conjugate gradient algorithm is used in the minimization process. The variational inverse model is tested in the James River estuary in Virginia by identical twin experiments. Numerical experimental results show that variational inverse data assimilation is a useful tool for retrieving poorly known parameters in a cohesive sediment transport model.