Refraction is the tendency of light to bend as it passes from one medium to another, such as from water to air. It results as light travels at different speeds through various substances due to the different densities.
For example, light travels through air at a faster rate than it does through water, so when light enters the water it enters at a different angle. Unless of course it enters at a pure 90 degree angle, like the sun when it is straight over head.
So for divers to see clearly under water, we wear masks. Now the light must travel from water, glass, and air to reach our eyes. During each pass the light must bend, shape through each medium before we see the object. As a result objects will appear closer to us at a 4:3 ratio than their actual size. Meaning that an object that is 4 feet away will appear to be only 3 feet away. That is why it is hard to determine actually how far away an object is in relation to you as a diver, as discussed in the next paragraph.
There is a tendency to under estimate the distance due to refraction. At greater distances and under certain conditions the objects may appear farther away than this ratio suggests. These phenomenon is called visual reversal, where objects appear father away than they actually are. In other words, visual reversal is just that, a reverse of what you would expect if seeing an object on land.
This reversal depends upon depth and seems to be a result of decreased brightness, and reduced contrast. The deeper you dive the less light that is allowed to penetrate the water. Hence, it gets drastically darker the deeper you dive. The same happens with color, the deeper the dive the less color that appears. As a side note, this is why many divers carry lights underwater to see the colors even if it is bright on land.
Also can result from absence of visual / distance cues like what we have on land.
In highly turbid (low viz) water, even relatively close objects tend to look farther away.
As a rule and in closing, in estimating distances, the closer the object the more likely it will appear closer than it actually is due to refraction. The more turbid the water, the more likely that close object will appear farther away than it is due to visual reversal.