ABSTRACT: Nursery habitats are important to many fish populations by ensuring optimal conditions for the survival and growth of juveniles. Protection of these habitats can be critical to the conservation of endangered fish species. We investigate potential essential habitats for early life stages of smooth hammerhead, Sphyrna zygaena, and tope, Galeorhinus galeus, two highly migratory and endangered shark species. The study focusses on an oceanic island in the Azores archipelago, North Atlantic, where a nursery area for 2 to 4-year-old smooth hammerhead has been recently described. Baited remote underwater video systems and scientific longline fishing were used to sample across a depth range of 30–135 m on the island shelf. Young-of-the-year sharks were identified based on body size measurements. A primary smooth hammerhead nursery area was found to exist within the larger nursery site. Smooth hammerhead of different sizes were segregated spatially, suggesting an ontogenetic shift in habitat use. In contrast, tope were not confined to the nursery area but seemed to use the entire island shelf as an essential habitat. Juvenile tope had a balanced sex-ratio, while mature individuals were predominantly females. This study provides a first description of habitat use of natal smooth hammerhead and juvenile tope around an oceanic island in the mid-Atlantic. The results of this study highlight that Faial Island is an essential habitat for critical life history stages of both species, and the Azores Archipelago might have a more important role for the North Atlantic populations of these sharks than previously thought.