Palinurid rock (or spiny) lobsters constitute valuable seafood fisheries around the world. Post‐harvest mortality can have a substantial economic impact on the value of these fisheries and damage the brand identity of an otherwise fungible commodity. In this study, sudden, large‐scale mortalities in the Australian Rock Lobster industry were investigated through comprehensive haemolymph biochemistry panels, measurements of immune status and nutritional condition. A cohort of lobsters (n = 25) was sampled over a 4‐week period at a commercial processing facility, with the final sample occurring during a mortality event. A comparison of 22 biochemical parameters, including electrolytes, minerals, ions, metabolites and enzymes, showed a notable disruption in osmoregulation, protein content and enzymes during weeks 3 and 4 of the study. Haemocyte counts showed a decline in circulating haemocytes by the time of the mortality event along with a shift in the proportion of hyalinocytes to granulocytes favouring the former. The condition index was variable over the sampling schedule, possibly linked to observed incidences of cannibalism, with no evidence of an overall low condition that would explain mortalities. The lobsters sampled in this study did not show any consistent or progressive changes in biochemistry that may indicate a pathogen or disease as a causative agent. Rather, analysis of the water quality within the facility suggested that mortality was due to sub‐optimal water quality characterized by a combination of two factors, a substantial decrease in the pH and potential nitrogen toxicity, that caused a physiological response comprised of an ion imbalance, altered enzyme activity and, ultimately, mortality. These results offer a comprehensive characterization of the impact of unexplained morbidity on the biochemistry and physiology of lobsters, illustrate the harm of sub‐optimal aquaculture practices and highlight the need for a better understanding of aquaculture practices and their effects on economically important seafood industries.