We evaluate a three-dimensional, nested-grid nearshore model of Lake Michigan for its ability to describe key aspects of hydrodynamics and solute transport using data from a field study conducted in summer 2008. Velocity comparisons with observations from five bottom-mounted ADCPs at different depths in the coastal boundary layer (CBL) show that the numerical model was able to simulate currents and flow reversals accurately within the inertial boundary layer, however model accuracy reduced close to the shoreline. Power spectra of observed and simulated velocity time series at different locations showed that the hydrodynamic model was able to describe the energy contained in the inertial scales, but over-predicted turbulent dissipation rates. As a result, model-predicted values of energy in the smaller, dissipation scales were lower compared to values calculated from observations in the CBL. Differences between energy contained in the observed and simulated velocity spectra increased as the shoreline is approached. Observations showed that vertical variations in the alongshore and cross-shore velocities were dominated by inertial waves. Inaccuracies in representing energy dissipation rates and processes not explicitly described in the hydrodynamic model (e.g., anisotropy, waves) could potentially contribute to errors in describing transport in the CBL. Measurements from a continuous dye release experiment from a riverine outfall were described using a nearshore model with a mean horizontal dispersion coefficient of 5.6 m2/s. Improved representations of physical processes (such as turbulence, internal waves and wave-current interactions) can be expected to provide better descriptions of solute transport in the CBL.