Abstract Observations have been made of a stably-stratified nighttime boundary layer perturbed by Kelvin-Helmholtz internal waves with critical levels around 600 m. Significant turbulence intensities were measured although the time-mean gradient Richardson numbers were large and positive. It is shown by constructing energy budgets of wave and turbulent components separately that there is an essential flow of kinetic energy from wave to turbulence and that the mechanics of this exchange process depend upon the nonlinear character of the wave field. Turbulent energy budgets were followed through a wave cycle and revealed that turbulence production occurred during only one quarter of a wave period, the rest of the time being taken up by redistribution of turbulent kinetic energy (tke) among the three orthogonal components, relaxation under the effects of density stratification and dissipation. The principal path of energy dissipation is through conversion of vertical component tke to density fluctuations, wh...