The number of foreigners living in Japan has been increasing since the end of World War II; it reached 2.085 million in 2006, constituting 1.63% of the total population of Japan. Many sociologists have shown interest in the recent growth of the number of foreigners; however, few studies analyze the formation of ethnic communities from a statistical and a cross-regional viewpoint. Using a multiple regression model, this study aims to analyze the contribution of an ethnic network to the growth of co-ethnics in all the municipalities in Japan. In addition, the study aims to assess the impact of the period of time for which these foreigners have been living in Japan. It is observed that an ethnic network has a positive effect on the growth of co-ethnics in the same municipality. However, this trend is strongly related to the Japanese visa system. Foreigners are strictly screened at the border; hence, an ethnic network is activated only when people hold valid visas. Thus it is shown that an ethnic network is not the general path followed by foreigners settling in Japan.