This paper presents an optical depth imaging system optimized for highly scattering environments such as underwater. The system is based on the time-correlated single-photon counting (TCSPC) technique and the time-of-flight approach. Laboratory-based measurements demonstrate the potential of underwater depth imaging, with specific attention given to environments with a high level of scattering. The optical system comprised a monostatic transceiver unit, a fiber-coupled supercontinuum laser source with a wavelength tunable acousto-optic filter (AOTF), and a fiber-coupled single-element silicon single-photon avalanche diode (SPAD) detector. In the optical system, the transmit and receive channels in the transceiver unit were overlapped in a coaxial optical configuration. The targets were placed in a 1.75 meter long tank, and raster scanned using two galvo-mirrors. Laboratory-based experiments demonstrate depth profiling performed with up to nine attenuation lengths between the transceiver and target. All of the measurements were taken with an average laser power of less than 1mW. Initially, the data was processed using a straightforward pixel-wise cross-correlation of the return timing signal with the system instrumental timing response. More advanced algorithms were then used to process these cross-correlation results. These results illustrate the potential for the reconstruction of images in highly scattering environments, and to permit the investigation of much shorter acquisition time scans. These algorithms take advantage of the data sparseness under the Discrete Cosine Transform (DCT) and the correlation between adjacent pixels, to restore the depth and reflectivity images.