In 1991, CSIRO was approached to design and manage an environmental study of the Bay to seek answers to questions concerning the sustainable use and management of the Bay. The Study began in October 1992 and finished in June 1996. The Port Phillip Bay Environmental Study was managed by CSIRO and supervised by a Management Committee chaired by the (then) Department of Conservation and Natural Resources. Also represented on the committee were the EPA, Melbourne Water, Melbourne Parks and Waterways and the former Port of Melbourne Authority. The Study was totally funded by Melbourne Water and Melbourne Parks and Waterways. In all, some 47 research tasks were conducted, ranging from scientific literature reviews to full-scale field surveys. All were contracted out. Of the 30 contractors, six were Victorian State agencies, three Commonwealth agencies, nine universities and 12 consultants. Nineteen contractors were Victorian based, seven from interstate and four from overseas. The research programs covered the fields of physical oceanography, toxicants, algal nutrients, marine ecology and ecological modelling. An important feature was the development of a numerical model which integrated data collected during the present and previous studies. This model describes and quantifies the chemical and biological processes in the Bay ecosystem. It enables prediction of the likely effects of gross changes in catchment practices. The toxicant research program showed the Bay waters, sediments and biota to be relatively unpolluted. Exceptions were found in areas close to sources such as Corio Bay, Hobsons Bay and the mouths of creeks and drains. The Study confirmed unequivocally that nitrogen is the nutrient element limiting algal growth in the Bay. This was found to be the result of denitrification of most nitrogen entering the Bay from both the catchment and sewage effluent. The Bay hosts a rich and diverse flora and fauna with very high productivity. Most of this plant and animal production forms a huge recycling system and there is little evidence of nutrients accumulating in the Bay. The Study was able to identify the critical nutrient loading beyond which irreversible damage to the Bay would occur. Recommendations are made concerning sustainable nutrient loads. The highest priority is to reduce the nutrient loads from stormwater flows in the Yarra catchment and on the eastern shore. The biodiversity of the Bay is important and must be conserved. The Study has identified a number of issues concerning habitat destruction, resource management, restoration and conservation which need attention. The introduction of exotic species poses a significant threat to the Bay. Monitoring and control of the introduction of such organisms should be introduced. Finally, the Study makes a number of recommendations about ongoing monitoring and the importance of continued modelling for the sustainable management of the Bay. An ongoing link between science and management is essential. To ensure the sustainable use of the Bay for generations to come, management of the Bay must be seen in the context of both the Bay ecosystem and its catchments. The entire catchment/estuary system must be managed as a single entity.