Prawns are commercially one of the most important marine resources. However, in their early developmental stages, they face challenges related to physico-chemical and environmental changes. This study aimed at investigating the effects of temperature and salinity on egg incubation time, hatching success, larval and postlarval survival of the giant tiger prawn, Penaeus monodon (Fabricius 1798) obtained from the coastal waters of Tanzania. The adult females P. monodon collected off Rufiji delta were left to acclimatize and spawn at 28.5 ± 0.5 °C and 32 ppt in the hatchery. Spawned eggs were incubated at experimental temperatures of 27 °C, 31 °C and 35 °C with three subgroups of salinities of 30 ppt, 35 ppt and 40 ppt. The incubation time was longest (15.2 hours) at 27 °C and 30 ppt, and shortest (10.7 hours) at 35 °C and 40 ppt. Hatching success was highest (85.2%) at 31 °C temperature and 30 ppt salinity, and lowest (69.45%) at 35 °C and 40 ppt. Larval and postlarval survival was suitable at 27–31 °C and 30–35 ppt. These findings suggest that optimum rearing temperature and salinity for P. monodon range 27–31 °C and 30–35 ppt, respectively. Changes in temperature and salinity above the optimum range may jeopardize the hatching and subsequent survival of P. monodon especially at their early developmental stages which are more sensitive to environmental changes. Keywords:    Penaeus monodon, Temperature, Salinity, Incubation time, Hatching success, Survival rate.