Rapid speciation in Lake Victoria cichlid fish of the genus Pundamilia may be facilitated by sexual selection: female mate choice exerts sexual selection on male nuptial coloration within species and maintains reproductive isolation between species. However, declining water transparency coincides with increasingly dull coloration and increasing hybridization. In the present study, we investigated the mechanism underlying this pattern in Pundamilia nyererei, a species that interbreeds with a sister species in turbid but not in clear water. We compared measures of intraspecific sexual selection between two populations from locations that differ in water transparency. First, in laboratory mate-choice experiments, conducted in clear water and under broad-spectrum illumination, we found that females originating from turbid water have significantly weaker preferences for male coloration than females originating from clear water. Second, both the hue and body coverage of male coloration differ between populations, which is consistent with adaptation to different photic habitats. These findings suggest that the observed relationship between male coloration and water transparency is not mediated by environmental variation alone. Rather, female mating preferences are indicated to have changed in response to this variation, constituting the first evidence for intraspecific preference-trait co-evolution in cichlid fish. © 2010 The Linnean Society of London, Biological Journal of the Linnean Society, 2010, 99, 398–406.