AbstractStress is an important potential factor mediating a broad range of cellular pathways, including those involved in condition‐dependent (i.e., honest) color signal expression. However, the cellular mechanisms underlying the relationship between stress and color expression are largely unknown. We artificially elevated circulating corticosterone levels in male tawny dragon lizards, Ctenophorus decresii, to assess the effect of stress on the throat color signal. Corticosterone treatment increased luminance (paler throat coloration) and decreased the proportion of gray, thereby influencing the gray reticulations that produce unique patterning. The magnitude of change in luminance for corticosterone‐treated individuals in our study was around 6 “just noticeable differences” to the tawny dragon visual system, suggesting that lizards are likely to be able to perceive the measured variation. Transmission electron microscopy (TEM) of iridophore cells indicated that luminance increased with increasing density of iridophore cells and increased spacing (and/or reduced size) of crystalline guanine platelets within them. Crystal spacing within iridophores also differed between skin colors, being greater in cream than either gray or yellow skin and greater in orange than yellow skin. Our results demonstrate that stress detectably impacts signal expression (luminance and patterning), which may provide information on individual condition. This effect is likely to be mediated, at least in part, by structural coloration produced by iridophore cells.