As part of the Subarctic Pacific Ecosystem Research program, we made observations of upper ocean physical and biological properties at 50N; 145W during 12–21 May 1984 from a drifting buoy, instrumented with a thermistor chain and meteorological sensors; a CTD/rosette bottle profiler; a shipboard solar radiometer; and a microstructure profiler equipped with a fast response thermistor and two airfoil velocity probes. At that time, the ocean above the seasonal thermocline was divided by a shallow thermocline step (∼0.5°C) into two layers with different turbulence characteristics and dynamics. The surface layer thermal structure (even in wind speeds up to 14 m s–1) underwent a clear diurnal cycle down to at least 20 m, but the rate of dissipation of turbulent kinetic energy ε did not display day/night differences and was negatively or not correlated with the buoyancy frequency N. Below the shallow thermocline step, ε and N covaried, both reaching maximum values in the permanent pycnocline at 80–90 m. Bio-optical properties of the phytoplankton showed different responses to the different physical environments in the two layers. The initial slope of the relationship between photosynthetic rate and irradiance differed significantly between the two layers; and the phytoplankton in the surface layer displayed strong midday inhibition of fluorescence yield down to 30 m. On the one calm day, both the diurnal thermal signal and the fluorescence inhibition were confined to the top few meters, indicating that the deeper penetration on other days was due to near-surface effects being redistributed throughout the upper layer by wind mixing. The turbulence within the permanent pycnocline appeared to be anisotropic down to viscous scales, effectively eliminating vertical turbulent exchange. Such anisotropy in highly stable layers may favor persistence of “microzones” of enriched nutrients but it precludes calculation from microstructure measurements of accurate estimates of the vertical coefficient of turbulent diffusion Kz, required to estimate the vertical flux of dissolved nitrate through the permanent pycnocline.