A telemetry system for studying decapod crustacean behaviour is described which uses low frequency, digitally encoded electromagnetic tags whose signals are detected with a grid of loop aerials on the seabed. Electromagnetic telemetry can be used to study short range movements of cryptic animals in topographically complex habitats that are not amenable to ultrasonic telemetry. Digital encoding allows many individuals to be monitored simultaneously and one or more behavioural, physiological or environmental variables to be telemetered. In the present system, tag signals convey identity and a measure of activity derived from an integral tilt switch. Translocational movements are indicated by detection of tags with different aerials. A central data logger located on the seabed decodes and records tag signals and environmental measurements. Design life of tags is >1 year and the receiving system batteries are replaced by divers at intervals of up to 4 weeks. In field tests, crab (Cancer pagurus L.) and lobster (Homarus gammarus (L.)) activity was monitored at an artificial reef for 14 months. Examples of the type of information acquired are presented to illustrate the capabilities of the system and potential applications are discussed. Limitations of digital electromagnetic telemetry stem mainly from the short range of detection, the need for cables on the seabed and the size and shape of the transmitting tag.