SUMMARYMany animals, particularly reptiles, amphibians, fish and cephalopods, have the ability to change their body colour, for functions including thermoregulation, signalling and predator avoidance. Many fish plastically darken their body colouration in response to dark visual backgrounds, and this functions to reduce predation risk. Here, we tested the hypotheses that colour change in fish (1) carries with it an energetic cost and (2) affects subsequent shoal and habitat choice decisions. We demonstrate that guppies (Poecilia reticulata) change colour in response to dark and light visual backgrounds, and that doing so carries an energetic cost in terms of food consumption. By increasing food intake, however, guppies are able to maintain growth rates and meet the energetic costs of changing colour. Following colour change, fish preferentially choose habitats and shoals that match their own body colouration, and maximise crypsis, thus avoiding the need for further colour change but also potentially paying an opportunity cost associated with restriction to particular habitats and social associates. Thus, colour change to match the background is complemented by behavioural strategies, which should act to maximise fitness in variable environments.