The present study was undertaken to determine the effects of both extracapsular oxygen concentration and temperature on embryonic development in Chorus giganteus. In normoxia increasing water temperature from 12°C to 18°C reduced by 15 days the median time required for the capsules to hatch. Hypoxia (oxygen content at 50% of air saturation) generated a low development rate and totally prevented both shell secretion and larval hatching from the egg capsule. Experimental transfer at weekly intervals, from normoxia to hypoxia and vice versa, induced a decrease and increase in the embryonic ash content, respectively, but did not affect the number of hatched larvae. Such an effect was more pronounced at 12°C than at 15°C or 18°C. The embryonic inability to produce a shell under hypoxia is likely to be a result of the low intracapsular oxygen concentration (IPO2) generated as the combined effect of a low extracapsular oxygen concentration (environmental) added to the intracapsular embryonic oxygen demands, which lowers the IPO2 still further. Under such conditions, a decrease in intracapsular pH is likely to take place, and, if so, embryos might divert carbonates away from shell calcification to balance such changes in pH.