Abstract
1. The damselfish Eupomacentrus Planifrons develops dense territorial populations in staghorn coral (Acropora cervicornis). 2. Field surveys and field experiments revealed that individuals preferred to maintain a territory in an inferior position within a large group than to be isolated on prime habitat. 3. Individuals in inferior positions within the group often meandered about the colony ("forays") in search of vacancies within superior habitats. 4. The size of the damselfish was correlated with habitat quality with larger individuals being found in superior portions of the staghorn colony. As areas became vacant, they were populated by individuals of similar size to the previous owner and to surrounding individuals. 5. As both males and females maintained territories within a colony, the larger colonies gave individuals greater access to potential mates. This has support since an individual's mobility outside the boundaries of its colony was limited and the most courtship was observed in the largest colonies. 6. Similarities between permanent territorial colonies and dominance systems are discussed.

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