ABSTRACT: The potential of the massive reef building coral Siderastrea siderea to be a reliable archive of past environmental variations was investigated by means of a field experiment conducted on a fringing reef in Panama. Over a 14 mo experimental period,5 closely spaced and shallow subtidal coral colonies were cored at 1 mo intervals. These cores were subsequently analysed to determine linear extension (growth) and the δ¹³C and δ^{18</suO of each monthly growth increment. Environmental conditions were recorded continuously by instruments deployed within a distance of 10 to 110 m from the corals. The environmental variables sea surface temperature (SST), salinity, wind, sun and rainfallwere all well correlated with one another, reflecting the dominant seasonal cycle in the region. Of the 3 skeletal attributes considered in this study, skeletal δ18O showed the strongest correlation with this seasonalcycle. The seasonal variations in skeletal δ18O are attributed to changes in SST (accounting for ca 60% of the δ18O signal) and inferred changes in water isotopic composition dueto rainfall and runoff (ca 40% of the δ18O signal). Although these results indicate that this coral is capable of yielding high-resolution paleoenvironmental records from retrospective analysis of the skeleton, therewere significant and unexplained between-colony differences in mean δ18O. Therefore, for this species of coral in this setting, great care must be taken before interpreting the regional environmental significance ofeither gradual changes in mean δ18O through the length of a single long coral core, or differences between modern and ancient (fossil) colonies. Although skeletal δ13C and growthrate did show some relatively weak but significant correlations with some of the environmental variables, especially when the records from all colonies were combined, it was concluded that these attributes have relatively low potential for regionalpaleoenvironmental reconstruction.}