Small-scale suspended sediment dynamics involve transport modes where grouping of suspended particulate matter (SPM) forms distinct patterns in the water. Field data on suspended matter dynamics at a particular location of a tidal channel show the frequent occurrence of turbidity clouds. These appear at spatial scales of tens of meters and temporal orders of minutes. In situ grain-size analysis reveals that the turbidity clouds are mainly composed of aggregates around 0.35 mm in size. Although the SPM signal reveals similar oscillations as the transporting current, no direct correlation was observed between the occurrence of clouds and local hydrodynamic characteristics. To test how the formation of turbidity clouds can be related to the hydrodynamic environment and particle motion, we developed a numerical model for the simulation of particle grouping. The simulations show stable and weakly stable modes of particle clustering, depending on the environmental conditions. A prominent dependence of group stability on the amplitude of current velocity oscillations is revealed. As the local dynamics can be considered to be near the derived threshold of stable and weakly stable grouping, the temporal occurrence of turbidity clouds is explained by the temporal exceedance of a critical oscillation amplitude and the availability of suspended matter as the main limiting factors.