Temperature is important for optimization of rearing conditions in aquaculture, especially during the critical early life history stages of fish. Here, we experimentally investigated the impact of temperature (16, 18, 20, 22 and 24°C) on thermally induced phenotypic variability, from larval hatch to first-feeding, and the linked expression of targeted genes [heat shock proteins (hsp), growth hormone (gh) and insulin-like growth factors (igf)] associated to larval performance of European eel, Anguilla anguilla. Temperature effects on larval morphology and gene expression were investigated throughout early larval development (in real time from 0 to 18 days post hatch) and at specific developmental stages (hatch, jaw/teeth formation, and first-feeding). Results showed that hatch success, yolk utilization efficiency, survival, deformities, yolk utilization, and growth rates were all significantly affected by temperature. In real time, increasing temperature from 16 to 22°C accelerated larval development, while larval gene expression patterns (hsp70, hsp90, gh and igf-1) were delayed at cold temperatures (16°C) or accelerated at warm temperatures (20-22°C). All targeted genes (hsp70, hsp90, gh, igf-1, igf-2a, igf-2b) were differentially expressed during larval development. Moreover, expression of gh was highest at 16°C during the jaw/teeth formation, and the first-feeding developmental stages, while expression of hsp90 was highest at 22°C, suggesting thermal stress. Furthermore, 24°C was shown to be deleterious (resulting in 100% mortality), while 16°C and 22°C (~50 and 90% deformities respectively) represent the lower and upper thermal tolerance limits. In conclusion, the high survival, lowest incidence of deformities at hatch, high yolk utilization efficiency, high gh and low hsp expression, suggest 18°C as the optimal temperature for offspring of European eel. Furthermore, our results suggest that the still enigmatic early life history stages of European eel may inhabit the deeper layer of the Sargasso Sea and indicate vulnerability of this critically endangered species to increasing ocean temperature.