Occurrence, abundance, recruitment, settlement and mortality of Japanese flounder larvae and juveniles were investigated in Shijiki Bay, Hirado Island, during the period of 1982 through 1986, as a biological basis for farming fisheries. The pelagic larvae were found to be widely dispersed over the entire offshore area examined, but metamorphosed demersal juveniles were found to be restricted to shallow near-shore sandy areas. Recruitment from offshore to inshore area, which mainly occurs at metamorphosing stages, exhibits a semi-lunar rhythm related to spring tides. The tidal phase-synchronized vertical migration of metamorphosing larvae suggests that selective tidal transport is primarily important for inshore migration of Japanese flounder. High mortality was supposed to occur immediately after settlement as inferred from the length composition of settled juveniles; number of individuals sampled decreased between 11 mm and 14mm SL, corresponding to about one week growth. The factors causing high mortality were discussed in relation to food deficiency, predation (including cannibalism), and so on. The 'settling mortality' seems to be primarily by food deficiency and secondarily by starvation-induced predation in the nursery ground examined, in which over-populated juveniles recruit in a rather restricted space.