Understanding of power losses and turbulence increase due to wind turbine wake interactions in large offshore wind farms is crucial to optimizing wind farm design. Power losses and turbulence increase due to wakes are quantified based on observations from Middelgrunden and state-of-the-art models. Observed power losses due solely to wakes are approximately 10% on average. These are relatively high for a single line of wind turbines due in part to the close spacing of the wind farm. The wind farm model Wind Analysis and Application Program (WAsP) is shown to capture wake losses despite operating beyond its specifications for turbine spacing. The paper describes two methods of estimating turbulence intensity: one based on the mean and standard deviation (SD) of wind speed from the nacelle anemometer, the other from mean power output and its SD. Observations from the nacelle anemometer indicate turbulence intensity which is around 9% higher in absolute terms than those derived from the power measurements. For comparison, turbulence intensity is also derived from wind speed and SD from a meteorological mast at the same site prior to wind farm construction. Despite differences in the measurement height and period, overall agreement is better between the turbulence intensity derived from power measurements and the meteorological mast than with those derived from data from the nacelle anemometers. The turbulence in wind farm model indicates turbulence increase of the order 20% in absolute terms for flow directly along the row which is in good agreement with the observations. Copyright © 2007 John Wiley & Sons, Ltd.