A submersible electronic device such as a waterproof cellular telephone may be provided with an image sensor. The image sensor may capture images of underwater objects. Control circuitry in the submersible electronic device may adjust image contrast and color balance based on information from sensors and other information. The electronic device may have an ambient light sensor. The ambient light sensor may be a color ambient light sensor and may be used in measuring ambient lighting conditions above water and underwater. A depth sensor may be used in measuring the depth of the image sensor and other components of the electronic device underwater. Information on the depth of the image sensor, information on the distance of an underwater object to the image sensor, and angular orientation information for the electronic device and image sensor may be used in color balancing an image.