The Chinese mitten crab (Eriocheir sinensis) is an economically essential crustacean specie in China. The outbreak of disease caused by Metschnikowia bicuspidata has resulted in high mortality and huge economic loss in the E. sinensis aquaculture industry. Immune priming can protect invertebrates against pathogens in the second exposure, which has been reported in adult E. sinensis and provides a novel approach for disease control. This study evaluated the effects of treatment with formalin-killed M. bicuspidata on the growth, development, and immunity of E. sinensis embryos and larvae. Stimulation of E. sinensis embryos with inactivated M. bicuspidata (Mb group) did not significantly affect the mass and size of embryos. While the carapace width, abdominal length, and tail length of larvae in the Mb group were significantly longer than those of control group in most stages. At 120 h and 144 h after embryo hatching, the metamorphosis rate of larvae in the Mb group was 24.59-fold (p < 0.05) and 16.07-fold (p < 0.001) higher than that in the control group. Moreover, after the larvae suffered alive M. bicuspidata challenge, the mortality in the Mb group significantly decreased (0.48-fold, p < 0.05) compared with that in the control group, and the mRNA expression levels of genes related to immunity (MAPK, Toll2, and STAT), growth (ATGL, Chi, Chymotrypsin, and mTOR), and development (Ubx) were significantly increased in the Mb group. These results suggested that stimulation of E. sinensis embryos with inactivated M. bicuspidata significantly promoted the growth and development of larvae and endowed them with stronger resistant capacity to M. bicuspidate. This finding may provide a novel and safe approach for preventing disease and improving larvae quality in E. sinensis aquaculture.