Phytoplankton photosynthesis links global ocean biology and climate-driven fluctuations in the physical environment. These interactions are largely expressed through changes in phytoplankton physiology, but physiological status has proven extremely challenging to characterize globally. Phytoplankton fluorescence does provide a rich source of physiological information long exploited in laboratory and field studies, and is now observed from space. Here we evaluate the physiological underpinnings of global variations in satellite-based phytoplankton chlorophyll fluorescence. The three dominant factors influencing fluorescence distributions are chlorophyll concentration, pigment packaging effects on light absorption, and light-dependent energy-quenching processes. After accounting for these three factors, resultant global distributions of quenching-corrected fluorescence quantum yields reveal a striking consistency with anticipated patterns of iron availability. High fluorescence quantum yields are typically found in low iron waters, while low quantum yields dominate regions where other environmental factors are most limiting to phytoplankton growth. Specific properties of photosynthetic membranes are discussed that provide a mechanistic view linking iron stress to satellite-detected fluorescence. Our results present satellite-based fluorescence as a valuable tool for evaluating nutrient stress predictions in ocean ecosystem models and give the first synoptic observational evidence that iron plays an important role in seasonal phytoplankton dynamics of the Indian Ocean. Satellite fluorescence may also provide a path for monitoring climate-phytoplankton physiology interactions and improving descriptions of phytoplankton light use efficiencies in ocean productivity models.