We developed a spectral technique that is independent of the light transport modality (diffusive or nondiffusive) to separate optical changes in scattering and absorption in the cat's brain due to the hemodynamic signal following visual stimulation. We observe changes in oxyhemoglobin and deoxyhemoglobin concentration signals during visual stimulation reminiscent of the functional magnetic resonance imaging (fMRI) blood oxygenation level dependence (BOLD) effect. Repeated measurements at different locations show that the observed changes are local rather than global. We also determine that there is an apparent large decrease in the water concentration and scattering coefficient during stimulation. We model the apparent change in water concentration on the separation of the optical signal from two tissue compartments. One opaque compartment is featureless (black), due to relatively large blood vessels. The other compartment is the rest of the tissue. When blood flow increases due to stimulation, the opaque compartment increases in volume, resulting in an overall decrease of tissue transmission. This increase in baseline absorption changes the apparent relative proportion of all tissue components. However, due to physiological effects, the deoxyhemoglobin is exchanged with oxyhemoglobin resulting in an overall increase in the oxyhemoglobin signal, which is the only component that shows an apparent increase during stimulation