High discard rates combined with release mortality may impede stock recovery of the overfished red snapper stock in the US Gulf of Mexico (GOM). However, estimates of recreational fishery discards are based on self-reporting by fishermen. In this study, we estimated reef fish catch and discard rates through direct observation of charterboat operations in the for-hire recreational fishing sector during 2012-2013. Captured reef fish were identified, weighed, and measured to total length (TL). Gear description, fishing location, reef type, and fishing time also were recorded. The retained and discarded red snapper catch were sampled on each trip (n = 54) for sex determination and aging. Mean total and red snapper discards per trip declined significantly with depth but were not significantly different between open and closed seasons. During open seasons, smaller red snapper (mean TL = 475 mm, median age = 4 year) were discarded alive in favor of larger fish (mean TL = 633 mm, median age = 6). Overall, red snapper comprised nearly 80% of all discards, with 81.5% of red snapper discards occurring at depths < 40 m. Red snapper also constituted the largest percentage (65%) of regulatory discards when targeting other species during red snapper closed seasons. Open season red snapper discards were primarily due to fishermen targeting larger fish, with only 13% of discards attributable to the minimum length limit (406 mm TL) and only 2.1% due to reaching the daily bag limit. Captains fished significantly deeper waters and targeted a greater proportion of natural reef habitat during closed red snapper seasons resulting in a 61% decline in red snapper catch but only a 25% decline in red snapper discards. The specific factor(s) (e.g., depth, reef type, and gear type) driving differences in red snapper catches between open and closed seasons remains unclear.