As a milestone in plant evolution, bryophytes play a crucial role in carbon and nitrogen cycling in terrestrial ecosystems, and are sensitive to environmental changes. Nitrogen fixation by bryophyte-microbial symbionts shed new light on nitrogen and carbon cycles in terrestrial ecosystems. The nitrogen fixation process by sphagnum-microbial symbionts is particularly important in peatland ecosystems, which are one of the largest terrestrial carbon pools. We summarized microbial taxa symbiotic with bryophytes and the methods tracing the nitrogen fixation of symbiotic microorganisms. We focused on sphagnum-microbial nitrogen fixation in peatland ecosystems and discussed factors affecting nitrogen fixation by bryophyte-microbial symbioses as well as their ecological functions. Future studies should investigate the relationships, interactions, and co-evolutionary mechanisms between bryophytes and their symbiotic nitrogen-fixing microorganisms. Developing multiple proxies is also necessary to identify the identity and function of microorganisms fixing nitrogen in bryophytes. Additionally, the interaction between environment and nitrogen-fixing functions of the bryophyte-microbial symbioses should be explored as well.