Multibeam echosounders (MBES) have become a widely used acoustic remote sensing tool to map and study the seafloor, providing co-located bathymetry and seafloor backscatter. Although the uncertainty associated with MBES-derived bathymetric data has been studied extensively, the question of backscatter uncertainty has been addressed only minimally and hinders the quantitative use of MBES seafloor backscatter. This paper explores approaches to identifying uncertainty sources associated with MBES-derived backscatter measurements. The major sources of uncertainty are catalogued and the magnitudes of their relative contributions to the backscatter uncertainty budget are evaluated. These major uncertainty sources include seafloor insonified area (1–3 dB), absorption coefficient (up to > 6 dB), random fluctuations in echo level (5.5 dB for a Rayleigh distribution), and sonar calibration (device dependent). The magnitudes of these uncertainty sources vary based on how these effects are compensated for during data acquisition and processing. Various cases (no compensation, partial compensation and full compensation) for seafloor insonified area, transmission losses and random fluctuations were modeled to estimate their uncertainties in different scenarios. Uncertainty related to the seafloor insonified area can be reduced significantly by accounting for seafloor slope during backscatter processing while transmission losses can be constrained by collecting full water column absorption coefficient profiles (temperature and salinity profiles). To reduce random fluctuations to below 1 dB, at least 20 samples are recommended to be used while computing mean values. The estimation of uncertainty in backscatter measurements is constrained by the fact that not all instrumental components are characterized and documented sufficiently for commercially available MBES. Further involvement from manufacturers in providing this essential information is critically required.