Water quality degradation in inland water bodies during summer periods due to phytoplankton growth is a global problem. Lake Burley Griffin (LBG) in Canberra, Australia is an artificial, turbid, urban lake which is prone to water quality degradation in summer due to phytoplankton blooms. In Australia only limited (spatial, spectral and temporal) datasets are available that detail the full bio-optical condition of the water body during summer transformation processes. In this study, we conducted field campaigns in LBG to measure biogeochemical as well as inherent optical properties (IOP) during summer 2010 to understand the variability in the optical response. Optically active biogeochemical components such as total suspended solids (TSS), Chlorophyll-a (Chl-a) and coloured dissolved organic matter (CDOM) varied over a wide range in response to changing environmental conditions during summer. The underwater optical environment was dominated by light scattering properties and the light absorption budget varied in response to changing CDOM and phytoplankton distributions. Specific inherent optical properties and spectral slopes of IOP observed here were different to other regional datasets, thus indicated the limitation in the extrapolation of optical models from other regions. Optical response as described by the scattering to absorption ratio and backscattering albedo showed that absorption due to CDOM and non-algal particulate matter (NAP) masked phytoplankton absorption features limiting the application of standard optical algorithms. A through description of bio-optical properties, relationships and their variability in response to changing summer biogeochemical conditions in a turbid optically complex lake is presented here.