The European Water Framework Directive commits partner countries to evolve uniform protocols for monitoring the environmental condition of natural water bodies, crucially integrating biological and ecological criteria from the associated ecosystems. This has encouraged considerable research on the development of bioindicator-based systems of water quality monitoring. A critical step towards this end is providing evidence that the proposed bioindicator system adequately reflects the human pressures to which a specific water body is submitted. Here we investigate the utility of pulse-amplitude-modulated (PAM) fluorometry, a fast, non-destructive and increasingly popular bioindicator-based method, in assessing water quality based on the widespread Mediterranean seagrass Posidonia oceanica, an important constituent of submersed benthic vegetation. Specifically, we evaluated the ability of PAM to discriminate between sites along a pre-established gradient of anthropogenic pressures and the consistency and reliability of PAM parameters across spatial scales. Our results show that the maximum quantum yield (Fv/Fm), representing the structural photosynthetic efficiency of the plant, responds significantly to the degree of site-level anthropogenic pressure. However, Fv/Fm values in our study increased with increasing pressure, in striking contrast with other studies that report declines in Fv/Fm values with increasing stress. A potential explanation for this discrepancy is that our study sites were influenced by multiple diffuse stressors (characteristic of most coastal waters) that could potentially interact with each other to influence Fv/Fm values in often unpredictable ways. The photosynthetic variables calculated from rapid light curves (ETR(max), maximum electron transport rate; α, initial slope of the curve; I (k), saturating irradiance), which represent an instant picture of the photosynthetic activity of the plant, were unable to clearly discriminate between sites subject to different anthropogenic pressures due to considerable small-scale variability. Taken together, these results suggest that even though PAM fluorometry may be a good candidate tool for monitoring water bodies in terms of costs and applicability, considerably more needs to be understood about how its parameters respond to real-world stressors, particularly when they act in concert with each other. With our present understanding of seagrass photosynthetic responses to anthropogenic stress, it would be ill advised to employ PAM as anything but a complementary tool to validate environmental stress derived with other, more robust methodologies.