Kelp beds are thought to provide a refuge for a variety of marine organisms by damping waves, changing hydrodynamic flow, offering substrata for epiphytic species, and altering the abundances of predators and prey. At the sub-Antarctic Prince Edward Islands, a typical flow-through system, kelp beds have the potential of acting as a prime habitat for a variety of pelagic species that would otherwise be swept away and lost from the island ecosystem. The current study investigates the effects of kelp beds on the abundance and composition of zooplankton and microphytoplankton, with the main aim of determining whether kelp beds act as a repository for larval stages in general, and for the swimming prawn, Nauticaris marionis, in particular. Salinity gradients created by freshwater run-off indicated that kelp beds at Marion Island retain surface water and restrict water exchange with the open ocean. Both the abundance and diversity of zooplankton were greatest within the kelp beds. This was partially due to the high abundance of kelp-associated species, but also to the apparent retention of naupliar larvae within the kelp canopy. Unlike the larvae of ostracods and copepods, caridean zoeae were rare, indicating that kelp beds are not a prime habitat for larvae of N. marionis. The larval retention mechanism for this species, therefore, remains unknown. Apart from retaining water and certain species of zooplankton, chlorophyll a/phaeopigment ratios confirmed the existence of a substantial detrital pool within the kelp beds. This retention of detritus may explain the observed importance of kelp-derived matter in the diet of many nearshore animals. In contrast to the zooplankton, kelp beds seemed to have little effect on the abundance and composition of microphytoplankton, and chlorophyll a values were low at all stations.