The combination of chromatophores, iridophores and photophores (and non-ocular light perceiving organs) makes for a strongly interactive relationship with aqueous light, or rather lights, since squids engage with different types of light, and in ranges difficult for us to imagine or measure. But we can recognize that squids metabolize their aqueous environment through both water and light. Just as their squishiness, in Aristotle’s terms, could be understood as water with the agency to perceive, judge and act, so their luminescence can be understood as light altered—digested, if you will—into intentional actions. Squids engage with changing, moving light as receptors, conveyors and projectors of light. They receive it, diffract it and create it. And they do so differently in different directions, at different depths and through different means. Their movements on a daily, seasonal and ontogenetic basis all participate in the environmental movements of lights, some of which we can perceive with our non-squid eyes and instruments designed to translate polarized light (as well as the light received in the non-visual photoreceptors), and much of which we cannot. The dynamics of the squid environment involve light and water interacting, and squids participate in those dynamics by metabolizing the continual changes into motion.

http://oceans.nautil.us/article/686/the-light-magic-of-squid