We measured underwater light penetration, phytoplankton biomass and photosynthetic activity during three years (1987–1990) in Lake Xolotlan (L. Managua), Nicaragua. Phytoplankton biomass governed the light climate of the photic zone, but as biomass also was composed of a varying proportion of dead algae, light availability for the potential biomass of actively photosynthesizing algae (170 mg Chl-a.m−2) was reduced. The concentration of chlorophyll-a within the photic zone was thus lower and ranged between 58 and 141 mg Chl-a.m−2. Still, photosynthetic activity was high (2,162 mg 02.m-2.h−1) due to an extremely high specific rate of photosynthesis; light was the only factor that limited growth. As also other conditions in Lake Xolotlan, beside light limitation, met with the requirements of the models that have been used to analyse production and photosynthetic characteristics in tropical lakes there was a striking agreement between observed and predicted values.