We present numerical simulations of near‐bed instability induced by internal waves shoaling over topography using a model with an explicit representation of the sediment concentration. We find that not all separation bubble‐bursting events lead to resuspension, though all lead to significant transport out of the bottom boundary layer. This transport can significantly enhance chemical exchange across the bottom boundary layer. When resuspension occurs, we find that it is largely due to two‐dimensional evolution of the separation bubble during the bursting process. Three‐dimensionalization occurs once the resuspended sediment cloud is transported out of the bottom boundary layer, and hence, redeposition is strongly influenced by three‐dimensional effects. We derive a criterion for resuspension over a linearly sloping bottom in terms of two dimensionless parameters that encapsulate the sediment properties.