Soil organic matter is a key resource base for agriculture. However, its content in cultivated soils is low and often decreases. This study aimed at examining the effects of long-term application of chicken manure (CM) and spent mushroom substrate (SMS) on organic matter accumulation, acidity, and hydraulic properties of soil. Two podzol soils with sandy texture in Podlasie Region (Poland) were enriched with recycled CM (10 Mg ha−1) and SMS (20 Mg ha−1), respectively, every 1–2 years for 20 years. The application of CM and SMS increased soil organic matter content at the depths of 0–20, 20–40, and 40–60 cm, especially at 0–20 cm (by 102–201%). The initial soil pH increased in the CM- and SMS-amended soil by 1.7–2.0 units and 1.0–1.2 units, respectively. Soil bulk density at comparable depths increased and decreased following the addition of CM and SMS, respectively. The addition of CM increased field water capacity (at –100 hPa) in the range from 45.8 to 117.8% depending on the depth within the 0–60 cm layer. In the case of the SMS addition, the value of the parameter was in the range of 42.4–48.5% at two depths within 0–40 cm. Depending on the depth, CM reduced the content of transmission pores (>50 µm) in the range from 46.3 to 82.3% and increased the level of residual pores (<0.5 µm) by 91.0–198.6%. SMS increased the content of residual pores at the successive depths by 121.8, 251.0, and 30.3% and decreased or increased the content of transmission and storage pores. Additionally, it significantly reduced the saturated hydraulic conductivity at two depths within 0–40 cm. The fitted unsaturated hydraulic conductivity at two depths within the 0–40 cm layer increased and decreased in the CM- and SMS-amended soils, respectively. The results provide a novel insight into the application of recycled organic materials to sequester soil organic matter and improve crop productivity by increasing soil water retention capacity and decreasing acidity. This is of particular importance in the case of the studied low-productivity sandy acidic soils that have to be used in agriculture due to limited global land resources and rising food demand.