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Most cultured Japanese eels (Anguilla japonica) show male sex differentiation; however, natural gonadal sex differentiation has not been evaluated. In this study, this process was characterized in wild eels. Differentiated ovaries and testes were observed after the eels grew to 320 and 300 mm in total length, respectively. The youngest ovary and testis appeared at 3 and 4 years old, respectively; however, undifferentiated gonads were found up to 7 years, suggesting that sex differentiation was triggered by growth rather than aging. gsdf, amh, foxl2b and foxl3b were highly expressed in the testes, whereas figla, sox3, foxn5, zar1, and zp3 were highly expressed in the ovaries. The expression of cyp19a1a and foxl2a did not differ significantly between the testis and ovary. In the ovaries, the cyp19a1a and foxl2a levels were highest in the early stages, suggesting that their function is limited to early ovarian differentiation. The foxn5, zar1 and zp3 levels tended to increase in the later stages, suggesting that they function after the initiation of ovarian differentiation. In undifferentiated gonads, dimorphic gene expression was not observed, suggesting that the molecular sex differentiation phase is short and difficult to detect. These findings provide the first demonstration of the whole course of natural gonadal sex differentiation in eels at molecular and morphological levels.