The effects of the toxic dinoflagellate Heterocapsa circularisquama on the activity rate, development rate, prevalence of damage, and survival rate of trochophore and D-shaped larvae of the pearl oyster Pinctada fucata martensii were studied in relation to H. circularisquama cell densities and exposure duration. In addition, larvae were regularly processed via scanning electron microscopy to investigate morphological damage. The activity rate of both larval stages was significantly decreased after 3–6 h of exposure to H. circularisquama at densities ranging from 100 to 2 × 10⁴ cells/mL. The prevalence of damage was significantly high after 3–6 h of exposure to H. circularisquama at densities of 100 to 2 × 10⁴ cells/mL and 5 × 10³ to 2 × 10⁴ cells/mL for trochophores and D-shaped larvae, respectively. Cytoplasmic discharge, mass mucus production, irregular shape, delayed or inhibited mineralization of the shell, mantle protrusion, the appearance of abnormal masses in the velum, and the exfoliation of the larvae cilia coupled with epithelial desquamation were frequently observed. The activity rate of D-larvae transformed from trochophores exposed to H. circularisquama for 12–48 h at densities ranging from 10 to 2 × 10⁴ cells/mL was significantly reduced. The survival of D-shaped larvae plummeted to less than 0.013 for densities ≥ 5 × 10³ cells/mL. The results indicate that H. circularisquama blooms have detrimental impacts on bivalves at early life stages. Blooms of H. circularisquama occurring during the spawning periods will influence the natural recruitment in P. fucata martensii and will have profound impacts on its population biology. Therefore, shellfish farms should not be built in coastal areas where H. circularisquama occurs, or genitors should be relocated during potential blooming periods.