The aim of this study was to report the first successful results on larval rearing of Chaetodontoplus septentrionalis, a description of larval and juvenile development stages, and appropriate first‐feed items for pilot‐scale larviculture systems. Fertilized eggs were obtained from natural spawnings from communally reared captive wild broodstock. Newly hatched larvae were 2.11 ± 0.06 mm (mean ± SD) in total length (LT) with 27–28 myomeres. Larvae completed yolk absorption within 3 days post hatching (dph) at 2.92 ± 0.11 mm LT. Transformation of larvae to the juvenile stage was completed at 16.51 mm LT, all fins had the adult complement of rays and spines. A statistical model: Y = (X × 0.0112) + (X2 × 0.0086) − (X3 × 0.00004) + 2.8065, where Y is mean LT (mm) and X represents dph, explained 99.8% of variation in growth (P < 0.001, R2 = 0.998). The effects of live feed on survival was significantly (P < 0.05) higher in larvae fed a combination of diet (ciliates, rotifers and copepods) than the others. These results indicate that C. septentrionalis is a potential species for captive breeding programs and the use of a combination of diet may be a suitable first food for the larviculture.