Composites of paraffin wax and polydimethylsiloxane (PDMS) have previously been demonstrated to exhibit thermally-induced switching between a transparent ‘on’ state and opaque ‘off’ state; however, the transmittance of the on state in previously investigated composites was found to decrease with increasing the wax content, thus limiting the achievable off-on contrast. We present a new paraffin–PDMS composite formulation that exhibits essentially no decrease in on-state transparency up to a 10% wax concentration. We furthermore identify the underlying cause of the switching as a microstructural transformation from a homogeneous, transparent state to an inhomogeneous, light-scattering state as a result of the phase transition of the paraffin. We then present a model based on the theory of turbid media that allows for the estimation of the scattering power of a composite of known composition based on easily observed parameters, and suggest ways in which the contrast between the ‘on’ and ‘off’ states may be further enhanced.