ABSTRACT: Nassau grouper Epinephelus striatus are of considerable ecological and commercial importance throughout the Caribbean, Gulf of Mexico and South Atlantic Bight, yet little is known of their settlement habitat and ontogenetic changes in earlyjuvenile habitat requirements. Suction sampling in macroalgae, seagrass, and coarse calcareous sand habitats and visual surveys of artificial patch reefs were conducted systematically in 1991 to 1994 during wintertime onshore movement of late larval-earlyjuvenile Nassau grouper within the vicinity of Lee Stocking Island, Bahamas. Recently settled fish [mean = 32 mm total length (TL)] resided within coral clumps (Porites spp.) covered by masses of macroalgae (primarily Laurencia spp.), withhighest densities at 8 fish m^-2. There was a positive and significant linear relationship between percent algal cover and post-settlement grouper density. Other habitat features such as algal displacement volume, and the numbers of holes,ledges, and sponges did not explain any significant variation in post-settlement density. Visual transects performed 4 to 5 mo after the settlement period (June) indicated that early juveniles (mean = 85 mm TL) residing within or adjacent to algal-coveredcoral clumps were mostly solitary (88%). Growth rates during February to June averaged 10 mm mo^-1 in 1993. When densities of early juveniles were relatively high in 1991 and 1993 (mean = 0.03 fish m^-2), there was also a positive andsignificant linear relationship between percent algal cover and early juvenile density. During 3 separate annual sampling periods, a decrease in early juvenile densities in macroalgal habitats from June to October was matched by a concomitant increase inabundance in artificial patch reefs located seaward of the macroalgal habitat. These habitat-specific abundance patterns suggest that juvenile Nassau grouper exhibit an ontogenetic habitat shift from macroalgal-Porites spp. clumps to patch-reefhabitats at a size of 120 to 150 mm TL during late summer and early fall. Based on habitat associations observed in this study, E. striatus were classified into 3 stages: (1) post-settlement fish (25 to 35 mm TL) residing exclusively withinalgal-covered coral clumps; (2) early juveniles (60 to 150 mm TL) residing outside of and adjacent to algal-covered coral clumps; and (3) larger juveniles (&GT150 mm TL), which were generally associated with natural and artificial patch reefs.