The growing interest in using exogenous agents to enhance the subtle differences between optical signatures of normal and cancerous tissue, has spurred the development of novel nanoparticulate agents that exhibit desirable optical responses and at the same time, used to target biomolecular markers of diseases. Gold nanoshells are a class of core-shell nanoparticle, exhibiting an extremely agile peak optical resonance, ranging from the near-ultraviolet to the mid-infrared wavelengths. Although optical properties of gold nanoshells in transmission have already been well documented, the reflectance characteristics have not been elucidated. Yet, in order to use gold nanoshells as a contrast agent for scattering-based optical diagnostic tools, it is critical to study the reflectance behavior. Using a combination of experimental observations and Monte Carlo models, we investigated gold nanoshell reflectance characteristics and its effect on tissue phantoms. Gold nanoshells were shown to significantly alter reflectance signatures of tissue phantoms, both experimentally and in computer models. Monte Carlo simulations of gold nanoshell reflectance demonstrated the efficacy of using such methods to model diffuse reflectance and also reaffirm the experimental observations. Our studies suggest that gold nanoshells are an excellent candidate as an optical contrast agent and Monte Carlo methods can be a useful tool for optimizing nanoshells best suited for scattering-based optical methods to enhance the detection and imaging of cancers.