Environmental DNA (eDNA) is often used to determine the presence and absence of species in a specific environment, be it air, water, or soil. Numerous environmental conditions are known to directly alter the rate at which eDNA degrades, including pH, temperature, and UV‐B light exposure. Beyond these, many limnological parameters have not been thoroughly examined for their ability to modify the degradation rate of eDNA. Here we used 20 mL microcosms with water collected from 12 lakes from the Kawartha Highlands near Peterborough Ontario, Canada, to study the decay rates of dissolved Yellow perch (Perca flavescens) eDNA. We measured and related rates of eDNA loss to multiple water quality parameters: total dissolved phosphorus, total dissolved nitrogen, size‐fractionated carbon, and chlorophyll‐a levels. Bioassays were also conducted to examine the bacterial role in eDNA degradation using three treatments under natural system conditions: non‐filtered, filtered (0.22 μm), and non‐filtered with added phosphorus (50 μg/L). Each microcosm exhibited a unique rate of degradation with eDNA half‐life (C0.5) ranging from 2.5 to 12.9 h. Chlorophyll‐a levels exhibited a positive linear relationship to the rate of degradation, while all other parameters showed no effect. The bioassays showed a general trend of the filtered treatments exhibiting the lowest rate of degradation, followed by the phosphorus treatments with the non‐filtered treatment containing bacteria exhibiting the highest rate of degradation. Overall, water with an increased level of chlorophyll‐a, in conjunction with elevated bacteria (i.e. non‐filtered bioassay) will exhibit a faster overall rate of eDNA degradation. These results show the necessity to individualize eDNA survey plans to the water body of interest and to account for environmental conditions relating to the microbial processing of eDNA.