The life history of the mud shrimp Axianassa australis, a common and widespread burrower inhabiting coastal mangroves and mud flats, is poorly known. This contribution presents the first information about the population structure, reproductive biology and fecundity of A. australis, based on individuals collected from September 2011 to December 2012 on Casa Caiada Beach, located in a densely urbanized area in north-eastern Brazil, using a yabby pump. The sex ratio did not depart significantly from the expected 1:1 proportion. A significant trend of left-handedness of the major cheliped was observed in the population. Females reached a larger maximum cephalothorax length (CL) than males. The differential growth between CL and the propodus of the major cheliped showed negative allometric growth for females and positive allometric growth for males, suggesting a trade-off between somatic growth and reproductive effort. Females bearing uneyed orange embryos predominated during all months in which ovigerous females were collected. Mean fecundity was 2379 eggs, ranging from 5 (7.55 mm CL) to 8300 (14.19 mm CL) eggs per female. About 71% of the variation in the number of eggs carried per female was explained by CL. The mean egg size correlated negatively with fecundity, indicating that large females of A. australis produce more and larger eggs than smaller females.