The view that marine species with planktonic dispersal have highly connected, demographically open populations is giving way to recognition that populations may often be largely self-recruiting, or demographically closed. This raises the question of what local conditions might favor isolation of populations. To test the importance of islands for local isolation in species with planktonic larvae, we examined allozyme variation among 35 populations of the intertidal snail Austrocochlea constricta in the Houtman Abrolhos Islands, Western Australia, spanning 60 km. Heterogeneity of allozyme frequencies among populations was high, with average F_ST of 0.237, indicating highly localized populations. Increased subdivision was associated with islands at different scales: between island groups, separated by deep water gaps, and between disconnected sets of islands within groups. At short distances, up to two km, subdivision increased fivefold between islands compared with that between populations on the same island. Along 11 km of continuous, sheltered shore, there was isolation by distance but among a linear series of islands over similar distance, there was greater subdivision at short distances but no association with distance. These patterns had been seen previously in the direct-developing snail Bembicium vittatum, but its finding in A. constricta confirms for a planktonic disperser the importance of this complex archipelago for both retention of locally produced larvae and disruption of patterns of connectivity. Taken together, these results indicate that islands can increase both the “open” and the “closed” components of recruitment and that applicable models of genetic connectivity depend substantially on local conditions.