Previous studies have shown that settlement of several crab species along the coast north of Point Reyes (38 degrees 00'N, 123 degrees 00'W) occurs primarily during relaxation from upwelling, when warm water flows poleward from the Gulf of the Farallones. During 1994 and 1995 we sampled planktonic larval distributions and hydrography both south and north of Point Reyes during upwelling to test whether high concentrations of crab and rockfish larvae were concentrated in the source of the relaxation flow to the south of Point Reyes. An upwelling plume off Point Reyes and an "upwelling shadow," indicated by warmer, less saline water in the northern Gulf, were evident in both years, as were frontal regions that marked the boundaries between water types of three different types: (1) newly upwelled, (2) oceanic, and (3) San Francisco Bay outflow. In addition, there was a fourth type, termed Gulf water, that was a mixture of these three types. Concentrations of larvae of cancrid, pinnotherid, and "coastal" crabs and rockfishes were high south of Point Reyes but were low or absent in the newly upwelled water north of the point. Within the upwelling shadow, these meroplankton taxa were associated with different water masses. Several intertidal crab species and early-stage cancrid crabs were concentrated in San Francisco Bay outflow water, and coastal Gulf water late-stage cancrid crabs, early- and late-stage pinnotherid crabs, and rockfishes were concentrated at the frontal region between newly upwelled and Gulf water. Of the taxa examined, only rockfishes were found offshore in oceanic water. The high concentrations of meroplankton observed suggest that the Gulf of the Farallones is an important retention area for larvae that settle into coastal populations in the Gulf and to the north via poleward transport during upwelling relaxation.