This paper presents a satellite-observation-based evaluation of the marine boundary layer (MBL) cloud properties from two Community Atmosphere Model, version 5 (CAM5), simulations, one with the standard parameterization schemes (CAM5–Base) and the other with the Cloud Layers Unified by Binormals scheme (CAM5–CLUBB). When comparing the direct model outputs, the authors find that CAM5–CLUBB produces more MBL clouds, a smoother transition from stratocumulus to cumulus, and a tighter correlation between in-cloud water and cloud fraction than CAM5–Base. In the model-to-observation comparison using the COSP satellite simulators, the authors find that both simulations capture the main features and spatial patterns of the observed cloud fraction from MODIS and shortwave cloud radiative forcing (SWCF) from CERES. However, CAM5–CLUBB suffers more than CAM5–Base from a problem that can be best summarized as “undetectable” clouds (i.e., a significant fraction of simulated MBL clouds are thinner than the MODIS detection threshold). This issue leads to a smaller COSP–MODIS cloud fraction and a weaker SWCF in CAM5–CLUBB than the observations and also CAM5–Base in the tropical descending regions. Finally, the authors compare modeled radar reflectivity with CloudSat observations and find that both simulations, especially CAM5–CLUBB, suffer from an excessive drizzle problem. Further analysis reveals that the subgrid precipitation enhancement factors in CAM5–CLUBB are unrealistically large, which makes MBL clouds precipitate too excessively, and in turn results in too many undetectable thin clouds.