Cephalopod populations typically display life-history traits such as semelparity, fast growth, and rapid response to environmental variation. The short lifespan of most squid species means that populations typically consist of single non-overlapping generations; the success of future generations therefore depends upon the ability of present generations to produce viable offspring. Pronounced inter-annual fluctuations in cephalopod population sizes reflect, at least in part, variability during the embryonic, hatchling and juvenile phases. As post-hatch survival is critically dependent upon the successful capture and consumption of zooplanktonic prey, variability in hatchling morphology (e.g. size, shape, presence of abnormality) and physiology (e.g. thermal tolerance) are likely to exert significant influence upon survival. This thesis investigates embryonic variability in two temperate loliginid squid: the Northern Hemisphere Loligo forbesi Steenstrup 1856 and the Southern Hemisphere Sepioteuthis australis Quoy and Gimard 1832. Developmental variability in L. forbesi and S. australis largely manifests via chromatophore pattern. The plasticity and thermal sensitivity of chromatophore characters exceed those of standard morphological characters (e.g. body shape and size). Elevation of incubation temperature is associated with reduced chromatophore number and heightened pattern asymmetry. Correlation between temperature and hatchling phenotype is sufficiently strong to permit estimation of mean thermal history from measure of multiple chromatophore and morphological characters. Increased water temperature is associated with increased frequency of morphological abnormality. In situ assessment of embryonic development in S. australis indicates ~89% egg viability within egg strands. Significant intra-seasonal differences in incidence of mortality and abnormality appear to reflect changes in environmental conditions. Embryos reared under fluctuating (field) thermal conditions grow faster than those reared under stable (aquaria) thermal conditions. Despite variation in size-at-hatch, no concomitant differences are observed in mantle muscle structure. The results of this thesis indicate no significant relationship between hatchling phenotype and underlying physiological processes (i.e. plasticity). I discuss the idea that quantification of embryonic development in cephalopods has relevance to both fisheries management and biomonitoring.