Hundreds of Megabit per second (Mb/s) data transmission over a moderate range (10m) underwater optical wireless channel is implemented with 4‐level pulse amplitude modulation scheme using an off‐the‐shelf light‐emitting diode as the optical source and digital equalizers. In particular, the channel nonlinear distortion from light‐emitting diode is considered and a matched model is developed. To mitigate these distortions under various 4‐level pulse amplitude modulation signal baud rates, the Bit error rate (BER) and Signal‐to‐noise ratio (SNR) performances of the pre‐, post‐ and matched‐equalizers are evaluated and compared. The digital matched‐equalizer bank is shown and verified to offer the best BER/SNR performance for 4‐level pulse amplitude modulation signal using more than 200 MBaud rate. With the proposed equalizer, we have recorded the highest data rate of 600Mb/s at 20% FEC limit over 10m free‐space underwater link.