The combined effects of temperature and salinity on the survival and development of larval and juvenile Palaemon serratus from the west coast of Ireland were investigated. Survival over time was measured at thirty combinations of temperature and salinity ranging from 10–19°C and 9–34‰ in a fully factorial design. Salinity had a stronger influence than temperature on survival at all larval stages except stage V. For juveniles the main effect changed from temperature between 100 and 200 degree days to salinity between 200 and 600 degree days and temperature between 600 and 800 degree days. Estimates of time taken to 50% mortality showed that juveniles tolerated lower salinities for longer periods and exhibited optimal salinity values which were 3‰ lower than larvae, at temperatures between 10 and 15°C. Larval stage durations were found to be influenced by temperature but not salinity. Comparison with published data suggests that populations of P. serratus have adapted to local conditions of temperature and salinity. The results presented here have practical implications for fisheries assessment and management, as the incorporation of environmental effects into stock–recruitment models can improve their predictive capacity.