The present study explored the Sporosarcina pasteurii-induced hydration and shrinkage properties of Portland cement. Bacterial culture solutions were incorporated into cement samples at varying dosages. The hydration properties of the fabricated samples were investigated through compressive strength tests, X-ray diffractograms, thermogravimetric analyses, and water absorption tests. In addition, autogenous and drying shrinkage measurements were carried out to monitor the volumetric changes of the samples with different bacteria contents. The test outcomes identified that the incorporation of bacteria retarded the progress of early hydration while promoting the reaction at a later stage by internal carbonation accompanied by the CO32− released by the bacteria. The internal carbonation was particularly effective in enhancing the reaction degree of belite, which produced more Csingle bondSsingle bondH. The microstructural modification of the samples by CaCO3 precipitation reduced the water absorption level and mitigated the development of drying shrinkage.