Abstract Modifications in the pulse-height spectra, obtained with a thin NaI(Tl) detector, for monoenergetic low-energy photon (LEP) sources present in water have been studied by performing Monte Carlo calculations with a view to facilitating proper assessment of LEP sources in vivo. The two specific characteristics studied are (a) shift in the photopeak energy and (b) deterioration of energy resolution, both in relation to the spectrum from a bare source. Data on these changes for various energies up to 100 keV and depths of immersion of a point source in water up to 12 cm have been generated theoretically. Results for a source of 241Am at a depth of 6.3 cm in water were verified experimentally. The individual roles of scattering in the intervening medium and of finite energy resolution of the detector in bringing about the observed spectral changes are discussed on the basis of the theoretical results.