Many marine demosponges contain large amounts of phylogenetically complex yet highly sponge-specific microbial consortia within the mesohyl matrix, but little is known about how these microorganisms are acquired by their hosts. Settlement experiments were performed with the viviparous Caribbean demosponge Ircinia felix to investigate the role of larvae in the vertical transmission of the sponge-associated microbial community. Inspections by electron microscopy revealed large amounts of morphologically diverse microorganisms in the center of I. felix larvae, while the outer rim appeared to be devoid of microorganisms. In juveniles, microorganisms were found between densely packed sponge cells. Denaturing gradient gel electrophoresis (DGGE) was performed to compare the bacterial community profiles of adults, larvae, and juvenile sponges. Adults and larvae were highly similar in DGGE band numbers and banding patterns. Larvae released by the same adult individual contained highly similar DGGE banding patterns, whereas larvae released by different adult individuals showed slightly different DGGE banding patterns. Over 200 bands were excised, sequenced, and phylogenetically analyzed. The bacterial diversity of adult I. felix and its larvae was comparably high, while juveniles showed reduced diversity. In total, 13 vertically transmitted sequence clusters, hereafter termed "IF clusters," that contained sequences from both the adult sponge and offspring (larvae and/or juveniles) were found. The IF clusters belonged to at least four different eubacterial phyla and one possibly novel eubacterial lineage. In summary, it could be shown that in I. felix, vertical transmission of microorganisms through the larvae is an important mechanism for the establishment of the sponge-microbe association.