The teleost Fundulus heteroclitus (Linnaeus) employs a semilunar spawning strategy, whereby eggs deposited on a spring tide optimally hatch on the following spring tide. This spawning strategy constrains the development period to similar or equal to 2 wk, regardless of the mean water temperature, which varies throughout the species' range (Nova Scotia, Canada, to Florida, USA). We hypothesized that F. heteroclitus embryos would exhibit development-rate compensation among populations to ensure appropriate hatching during the spring tide. Development rates of embryos from Massachusetts and Florida were examined. Northern embryos had faster temperature-specific development rates than southern embryos, while data from the literature showed that embryos from Delaware have an intermediate development rate. Results from reciprocal hybrid crosses indicated that there may be a genetic basis for these differences. In addition, northern embryos were more cold-tolerant and southern embryos more heat-tolerant. Field studies showed that embryos in their local environments develop at similar rates despite large temperature differences. Embryos seldom, if ever, experience lethal temperatures in their native habitats, but would do so if exposed to the temperature regimes at the extreme ends of the species' range. Thus, F. heteroclitus populations along the Atlantic coast have specifically adapted their development rates and thermal tolerances to the local thermal regime.