We developed an underwater image formation model that describes how light is absorbed and scattered by seawater and its constituents. We use the model to predict digital camera images of a reference target with known spectral reflectance at different distances and depths. We describe an inverse estimation method to derive three model parameters: phytoplankton absorption spectrum, chlorophyll concentration and the amount of colored dissolved organic matter or CDOM. The estimated parameters predict the spectral attenuation of light which can be used to color balance the images. In addition, parameter estimates can be used to monitor environmental changes turning a consumer digital camera into a scientific measurement device.