We examined the potential for bottom temperatures <= 12 degrees C to inhibit successful recruitment of planktonic lobster postlarvae to the benthos. In laboratory trials, postlarvae held at 11 degrees C exhibited higher mortality, slower development, and reduced size increase at molt relative to postlarvae held at 13 C. We sampled at field sites within Machias Bay, Maine (mean bottom temperature 12.39 degrees C, 46.1 degree-days >= 12 degrees C) and at the mouth of the bay (mean bottom temperature 11.57 degrees C, 5.1 degree-days >= 12 degrees C), where temperature was influenced by the cold Eastern Maine Coastal Current (EMCC). We found significantly higher settlement at the warm inshore site but, the abundance of competent planktonic postlarvae was not significantly different between sites, indicating a disconnect between postlarval abundance and settlement. Regional sampling of newly settled lobsters revealed a pattern of higher settlement at inshore sites extending across a broader coastal region impacted by the EMCC. Our results suggest that small differences in water temperature may shape settlement patterns through either behavioral avoidance of colder settlement sites or elevated postsettlement mortality of postlarvae settling at colder sites.