In comparison with the molecular genetics of melanogenesis in mammals, the regulation of pigmentation in poikilothermic vertebrates is poorly understood. Mammals undergo morphological colour change under hormonal control, but strikingly, many lower vertebrates display a rapid physiological colour change in response to the same hormones. The recent provision of extensive genome sequencing data from teleost zebrafish, Danio rerio, provides the opportunity to define the genes and proteins mediating this physiological pigment response and characterise their function biologically. Here, we illustrate the background adaptation process in adults and larvae and describe a novel assay to visualize and directly quantify the rate of zebrafish melanophore pigment translocation in unprecedented detail. We demonstrate the resolution of this assay system; quantifying the zebrafish melanophore response to melanin-concentrating and melanocyte-stimulating hormones. Furthermore, we investigate the intracellular signalling downstream of hormone stimulation and the biomechanical processes involved in zebrafish pigment translocation, confirming the importance of cyclic adenosine monophosphate (cAMP) as a mediator of pigment translocation and finding intact microtubules are essential for both melanin dispersion and aggregation in zebrafish, but that microfilament disruption affects aggregation only. In conclusion, we propose these data establish the zebrafish as an experimental model for studying both physiological colour change and the molecular basis of pigment translocation.