I present a model of the Maine lobster fishery that incorporates a monthly demand model and an empirically estimated production function that accounts for seasonal variability in catchability, inseason depletion, and congestion effects. I compare optimal exploitation with observed exploitation and evaluate the extent to which profits under a conventional individual transferable quota (ITQ) system would be dissipated by congestion and in-season depletion externalities. The models show that profits could be substantially increased from the status quo through effort reductions and changes in the harvest schedule, but profits under an ITQ system may be reduced by as much as 30% by unresolved externalities.