In heterogeneous habitats, camouflage via background-matching can be challenging because visual characteristics can vary dramatically across small spatial scales. Additionally, temporal variation in signalling functions of colouration can affect crypsis, especially when animals use colouration seasonally for intraspecific signalling (e.g. mate selection). We currently have a poor understanding of how wild prey optimise background-matching within continuously heterogeneous habitats, and whether this is affected by requirements of intraspecific signalling across biological seasons. Here, we quantified colour patterns of a wild population of shore skink (Oligosoma smithi), a variably coloured lizard endemic to New Zealand, to 1) investigate whether background-matching varies across a vegetation gradient; 2) assess potential signalling functions of colour; and 3) to determine whether there is a trade-off between requirements for crypsis and intraspecific signalling in colouration across seasons. Although all pattern types occurred throughout the vegetation gradient, we found evidence for background-matching in skinks across the vegetation gradient, where dorsal brightness and pattern complexity corresponded with the proportion of vegetation cover. There was also a significant disparity between ventral colour (saturation) of juveniles and adults, and also between sexes, suggestive of sex recognition. However, there was little indication that colour was condition-dependent in adults. Despite some evidence for a potential role in signalling, crypsis did not greatly differ across seasons. Our study suggests that selection favours a mix of generalist and specialist background-matching strategies across continuously heterogeneous habitats.