The factors controlling the accumulation of mercury in fish are poorly understood. The oil invoked lipid solubility of MMHg is an inadequate explanation because inorganic Hg complexes, which are not bioaccumulated, are as lipid soluble as their MMHg analogs and, unlike other hydrophobic compounds, MMHg in fish resides in protein rather than fat tissue. We show that passive uptake of the lipophilic complexes (primarily HgCl2 and CH3HgCl) results in high concentrations of both inorganic and MMHg in phytoplankton. However, differences in partitioning within phytoplankton cells between inorganic mercury — which is principally membrane bound — and MMHg — which accumulates in the cytoplasm — lead to a greater assimilation of MMHg during zooplankton grazing. Most of the discrimination between inorganic and MMHg thus occurs during trophic transfer while the major enrichment factor is between water and phytoplankton. As a result, MMHg concentrations in fish are ultimately determined by water chemistry which controls MMHg speciation and uptake at the base of the food chain.