Development of the gonads and embryo in the deep-sea sponge-associated shrimp, Spongicola japonica Kubo, was observed based on field samples collected from July 1993 to June 2000. Histological observation of gonads revealed that the gonadal maturities were divided into 4 and 5 stages in males and females, respectively. In females the smallest mature size was 5.5–6.0 mm in carapace length (CL), and the beginning of oocyte development was related to body size. The beginning of spermatogenesis was not related to body size. Grouped males started spermatogenesis at more than 3.0 mm CL, but the immature testis was recognized at 4.0–4.5 mm CL in solitary males. Embryonic development was classified into 12 stages based on the morphology of embryonic appendages. Ovarian maturity was almost always synchronized with embryonic stages in ovigerous females, and the females with fully developed embryos had fully ripened ovaries. The ovigerous females molted after hatching juveniles, and laid new eggs. Reproductive seasonality was not recognized in S. japonica. The induction of reproduction in this species may be controlled not by any physical environmental factors, but by other factors such as body size.