Diel vertical migration (DVM) of some zooplankters in eutrophic lakes is often compressed during peak hypoxia. To better understand the indirect consequences of seasonal hypolimnetic hypoxia, we integrated laboratory-based experimental and field-based observational approaches to quantify how compressed DVM can affect growth of a cladoceran, Daphnia mendotae, in central Lake Erie, North America. To evaluate hypoxia tolerance of D. mendotae, we conducted a survivorship experiment with varying dissolved oxygen concentrations, which demonstrated high sensitivity of D. mendotae to hypoxia (≤2 mg O2 l⁻¹), supporting the field observations of their behavioral avoidance of the hypoxic hypolimnion. To investigate the effect of temporary changes in habitat conditions associated with the compressed DVM, we quantified the growth of D. mendotae, using a 3 (food quantity) × 2 (temperature) factorial design laboratory experiment. Neither food quantity nor temperature affected short-term growth in body length of D. mendotae. However, D. mendotae RNA content (an index of short-term condition) decreased under starvation, indicating an immediate response of short-term feeding on condition. We further evaluated the effect of hypoxia-induced upward shifts in vertical distribution by quantifying the RNA content of D. mendotae from central Lake Erie before and during peak hypoxia. Despite high temperature and food quantity in the upper water column, RNA content in field-collected D. mendotae remained low during peak hypoxia. Furthermore,D. mendotae collected during peak hypoxia consisted of only small-bodied (<~1.25 mm) individuals, suggesting that behavioral avoidance of the hypoxic hypolimnion may also have indirect fitness costs.