The Australian lungfish Neoceratodus forsteri (Dipnoi) is an ancient fish that has a unique phylogenetic relationship among the basal Sarcopterygii. Here we examine the ultrastructure, histochemistry, and distribution of the retinal photoreceptors using a combination of light and electron microscopy in order to determine the characteristics of the photoreceptor layer in this living fossil. Similar proportions of rods (53%) and cones (47%) reveal that N. forsteri optimizes both scotopic and photopic sensitivity according to its visual demands. Scotopic sensitivity is optimized by a tapetum lucidum and extremely large rods (18.62 ± 2.68 μm ellipsoid diameter). Photopic sensitivity is optimized with a theoretical spatial resolving power of 3.28 ± 0.66 cycles degree−1, which is based on the spacing of at least three different cone types: a red cone containing a red oil droplet, a yellow cone containing a yellow ellipsoidal pigment, and a colorless cone containing multiple clear oil droplets. Topographic analysis reveals a heterogeneous distribution of all photoreceptor types, with peak cone densities predominantly found in temporal retina (6,020 rods mm−2, 4,670 red cones mm−2, 900 yellow cones mm−2, and 320 colorless cones mm−2), but ontogenetic changes in distribution are revealed. Spatial resolving power and the diameter of all photoreceptor types (except yellow cones) increases linearly with growth. The presence of at least three morphological types of cones provides the potential for color vision, which could play a role in the clearer waters of its freshwater environment. J. Comp. Neurol. 494:381–397, 2006. © 2005 Wiley-Liss, Inc.