Concern over the declining quality of Lake Tahoe led to the adoption of a compact between Nevada, California, and the federal government that required the Tahoe Regional Planning Agency (TRPA) to adopt a set of environmental thresholds to protect Lake Tahoe. The water quality threshold became the most controversial issue because it became apparent during the study that controls on development would be needed to reverse or halt the deterioration in the lake’s water quality. A dissolved inorganic nitrogen budget was developed to determine the relative importance of nitrogen sources and sinks. A model was developed to relate clarity and algal growth in Lake Tahoe to the nitrogen accumulating in the lake. A 25 percent reduction in nitrogen loads will be necessary to restore the lake’s algal growth rate and clarity levels to conditions that occurred before the greatest deterioration of the lake began.