The problem of optimal regulation of a fishery is discussed. Of special interest is the problem of regulating an overexploited fishery by reducing effort to allow the fish population to build up to a suitable level.We first argue that the problem requires an economic analysis based on the concept of maximization of present value. From this concept we then deduce a simple, general rule, the "Fisher Rule," which we subsequently use to determine optimal exploitation. Among the principal results are the following: (a) an optimal mesh-size is determined, which, because of the discounting of future revenues, is smaller than the size corresponding to maximum sustainable yield; (b) the optimal recovery policy for an overexploited fishery is deduced; it consists of a fishing closure permitting the fish population to reach an optimal age; (c) the optimal development of an unexploited fishery is deduced; an initial development stage characterized by large landings and profits is rapidly transformed into a situation of optimal sustained yield, in which both landings and profits may be significantly reduced; (d) the optimal policy is deduced for a fishery in which gear limitations are impractical; the result may be a strongly unstable fishing industry; (e) the effect of high discount rates, which might be employed by private fishing interests, is discussed; such rates may result in overfishing similar to the case of a common-property fishery.