Hydrodynamic dispersion has a significant impact on the mass transport of sediments and contaminants within coastal waters. In this study apparent horizontal dispersion in a tidally-dominated shallow estuary was investigated using field observations and a numerical model. A cluster of four Lagrangian drifters was released in two shallow regions inside Moreton Bay, Australia: between two small islands and in an open water area. During a 16-h tracking period, the drifters generally showed similar behaviour, initially moving with the dominant current and remaining together before spreading apart at the change of tide. Two dispersion regimes were identified, a slow dispersion during the earlier stage and a rapid dispersion during the latter stage of deployment. Such change in regime typically occurred during the succeeding ebb or flow tides, which may be attributable to residual eddies breaking down during reversal of tidal direction. In addition, a power function of the squared separation distance over the apparent dispersion coefficient produced an R2 exceeding 0.7, indicating a significant relationship between them. By applying a three-dimensional hydrodynamic model, the trajectories of artificial particles spreading in the bay were simulated, which allowed the calculation of dispersion coefficients throughout the entire bay. The study results demonstrate that the tidal effects on dispersion were dependent on the effect of tidal excursion and residual current. The tide was found to be the most dominant driver of dispersion in the bay when unobstructed by land; however, bathymetric and shoreline characteristics were also significant localised drivers of dispersion between the two islands as a result of island wake.