Baseline information is presented on embryo malformation rate and biomarkers in fish as indicators of sub-lethal stress caused by pollution in coastal waters of Xiamen, PR China. Fish and eggs were sampled from several areas in Xiamen coastal waters (Xiamen Harbour, Maluan and Tongan Bays and East Channel), where varying levels of pollutant input have been documented. Comparative sampling was done at a "cleaner" reference site at Dongshan Island. Embryonic malformation rates, which indicate general water quality, varied with location and species of fish, and exceeded background levels for unpolluted waters (assumed approximately 5%) by up to eightfold at some sites. Generally, sites around Xiamen Harbour show signs of poor water quality having highest mean levels of embryo deformity (20-30%) and these decreased towards open waters (Tongan Bay, Eastern Channel) where abnormalities approached background levels. An indication that toxic contaminants may be having a localised effect in the region, particularly in the harbour was reinforced by the biomarker assays. However, activities of the biomarkers ethoxyresorufin O-deethylase (EROD) and glutathione S-transferase in fish livers indicate no clear pattern, and there is no evidence that fish from the four sampling areas have been more or less exposed to PAHs and other compounds that induce these biomarkers. Antioxidant biomarkers (glutathione peroxidase, catalase, superoxide dismutase, and reduced glutathione) suggest that exposure to xenobiotics appears to be lowest in Dongshan and Maluan and highest in the harbour and Tongan. Inhibition of acetylcholinesterase in fish muscle indicated possible effects by organophosphate and carbamate pesticides in Xiamen waters and these effects may be greatest in the area of the harbour.