During Early Jurassic time, the Scots Bay Formation accumulated in an aerobic lake on the floor of the subtropical Fundy rift valley. A diverse biota flourished in the lake as evidenced by algal stromatolites, oncolites, charophytes, ostracods, gastropods, conchostracans, fish bones, calcispheres and logs. Carbonate wackestone and packstone were deposited in the littoral zone and lime mudstone accumulated offshore on a proximal slope. Silica-rich hydrothermal springs and seeps around and on the floor of the lake precipitated siliceous tufa and silicified adjacent carbonate strata. The tufa is characterized by the progressive sequence: (1) open-framework, porous substrate of goethite spheres, (2) encrusting chalcedony spherulites where goethite inclusions decrease in size and number outwards towards the surfaces of the spherulites, (3) a fringe of quartz on the chalcedony spherulites and (4) coarsening inwards mosaics of quartz that filled the remaining voids. Carbonate diagenesis included conversion of low-Mg calcite ooze to micrite and microspar-pseudospar, and local dissolution and reprecipitation of calcite cement. At times the lake shrank in size, concentrating silica in increasingly alkaline lake water which then silicified some of the carbonate strata and logs. The latest cements were calcite, zeolites and celadonite.