Aerobic methane oxidation (MOx) mediated by methanotrophs is a crucial mechanism in controlling methane emissions from the surface ocean to the atmosphere. Coastal waters dominate global oceanic methane emissions, but the dynamics, controls and roles of MOx remain largely unconstrained in the marginal seas around China. Here, we conducted a variety of biogeochemical analyses to investigate the controls of methane cycling and the dynamics of methanotrophic activity in the East China Sea and Yellow Sea. Methane was supersaturated in the surface seawater and the concentrations ranged from 2.8 to 19.8 nM. The distribution of methane was regulated by the sources and sinks, which were influenced largely by hydrological and biogeochemical factors. Methane was turned over rapidly with high rates (k: 5 × 10−4–0.04 d−1), indicating the enzymatic capability of methanotrophic biomass to metabolize methane. Rates of MOx varied significantly between sites (1 × 10−3–0.60 nM d−1) and relatively high MOx rates were observed in shallow waters. MOx exhibited the Michaelis‐Menten kinetics with the Vmax of 0.30 nM d−1 and a Km of 78.3 nM. Methanotrophic activity was impacted by environmental factors such as methane availability, nutrient levels, bacterial production and temperature. Nutrient addition experiments demonstrated that phosphate elevated MOx rates, while the activity was largely inhibited by ammonium probably due to competitive inhibition of the methane monooxygenase by ammonia. Comparing the depth‐integrated MOx rates with the air‐sea fluxes at selected sites showed that methane consumed through microbial oxidation accounted for up to 78.1% of the total methane loss (=sum of MOx rates and air‐sea flux), highlighting the role of MOx as a microbial filter for methane emissions.