Polarization sensitivity is documented in a range of marine animals. The variety of tasks for which animals can use this sensitivity, and the range over which they do so, are confined by the visual systems of these animals and by the propagation of the polarization information in the aquatic environment. We examine the environmental physical constraints in an attempt to reveal the depth, range and other limitations to the use of polarization sensitivity by marine animals. In clear oceanic waters, navigation that is based on the polarization pattern of the sky appears to be limited to shallow waters, while solar-based navigation is possible down to 200-400 m. When combined with intensity difference, polarization sensitivity allows an increase in target detection range by 70-80% with an upper limit of 15 m for large-eyed animals. This distance will be significantly smaller for small animals, such as plankton, and in turbid waters. Polarization-contrast detection, which is relevant to object detection and communication, is strongly affected by water conditions and in clear waters its range limit may reach 15 m as well. We show that polarization sensitivity may also serve for target distance estimation, when examining point source bioluminescent objects in the photic mesopelagic depth range.