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Abstract The plastic ability for a range of phenotypes to be exhibited by the same genotype allows organisms to respond to environmental variation and may modulate fitness in novel environments. Differing capacities for phenotypic plasticity within a population, apparent as genotype by environment interactions (GxE), can therefore have both ecological and evolutionary implications. Epigenetic gene regulation alters gene function in response to environmental cues without changes to the underlying genetic sequence and likely mediates phenotypic variation. DNA methylation is currently the most well described epigenetic mechanism and is related to transcriptional homeostasis in invertebrates. However, evidence quantitatively linking variation in DNA methylation with that of phenotype is lacking in some taxa, including reef‐building corals. In this study, spatial and seasonal environmental variation in Bonaire, Caribbean Netherlands was utilized to assess relationships between physiology and DNA methylation profiles within genetic clones across different genotypes ofAcropora cervicornisandA. palmatacorals. The physiology of both species was highly influenced by environmental variation compared to the effect of genotype. GxE effects on phenotype were only apparent inA. cervicornis. DNA methylation in both species differed between genotypes and seasons and epigenetic variation was significantly related to coral physiological metrics. Furthermore, plastic shifts in physiology across seasons were significantly positively correlated with shifts in DNA methylation profiles in both species. These results highlight the dynamic influence of environmental conditions and genetic constraints on the physiology of two important Caribbean coral species. Additionally, this study provides quantitative support for the role of epigenetic DNA methylation in mediating phenotypic plasticity in invertebrates.