Nearly half of the Oregon coast is comprised of dune-backed beaches, and these foredunes serve as protective features against coastal flood hazards. However, the ability of Oregon’s coastal dunes to protect against tsunami inundation is poorly understood due to existing inundation modeling that assumes static bathymetry. With an estimated 20% chance of partial rupture of the Cascadia Subduction Zone in the next 50 years, it is imperative to investigate how coastal dunes will mitigate tsunami impacts. This study explores how including sediment transport in tsunami inundation modeling at Netarts Spit, Oregon, USA impacts maximum tsunami flow depth and inundation extent, and how a tsunami shapes coastal dunes. Using the model FUNWAVE-TVD, we simulate the M1 tsunami scenario produced by the Oregon Department of Geology and Mineral Industries (DOGAMI) and show that the hydrodynamic output is comparable to the output produced by DOGAMI. Then, with the sediment transport module in FUNWAVE-TVD, we simulate tsunami-induced morphologic change. We show that dunes with a maximum pre-tsunami elevation of less than about 12 m are eroded vertically by up to 0.42 m. Additionally, we find that allowing for sediment transport in the simulations does not greatly impact inundation extent on Netarts Spit but does change maximum flow depth in some areas. Future work will aim to validate the sediment transport simulations using a robust record of tsunami deposits from the salt marsh in Netarts Bay.