Characteristics of the sexual reproduction and larval settlement of the haplosclerid sponge Chalinula sp., which inhabits the shallow waters (1 to 6 m) of Eilat, Red Sea, were investigated from September 1985 through to November 1987. This species was found to be a simultaneous hermaphroditic brooder, hence gonochorism is not the rule in the order Haplosclerida. Brooding always takes place in special brooding chambers. While the oocytes in the brooding chambers are among the largest known in sponges (355±37 μm), the spermatic cysts distributed in the choanosome are among the smallest known for this phylum (average 26±7 μm). Chalinula sp. breeds throughout the year and in experiments most larvae (74%) settled within 1 to 8 h post-release, generally within 4.5 h. Metamorphosis from larval shape to a sessile sponge lasts 1 to 6 h. Thus, larvae had a short swimming period, settled fast, and metamorphosed rapidly (within 1 to 6 h). The large size of the larvae may contribute to their ability to rapidly reorganize their body shape into that of a sessile sponge. In addition, the existence of already differentiated choanocyte chambers in the larvae, facilitates fast construction of the water filtration system in the newly settled sponges. The reproductive and larval characteristics of Chalinula sp. enable the larvae to settle on any vacant space in the reef, which may explain its abundance in the Red Sea.