The aim of the present study was to determine the optimum dietary levels of krill phospholipids (KPL) for sea bream (Sparus aurata) larvae, and its influence on larval development and digestive enzymes activity. Larvae were fed five formulated microdiets with five different levels of KPL. Complete replacement of live preys with the experimental microdiets for seabream larvae produced high survival and growth rates, particularly in fish fed the highest levels of KPL. In the present study, increase in dietary KPL up to 120 g kg−1 (100 g kg−1 total PL) significantly improved larval survival and growth, whereas further increase did not improve those parameters. An increase in alkaline phosphatase, trypsin and lipase activity with the elevation of KPL up to 120 g kg−1 was also found denoting a better functioning of digestive system. Besides, there was a linear substrate stimulatory effect of dietary KPL on phospholipase A2 activity. Finally, increasing dietary KPL lead to better assimilation of n-3 HUFA especially eicosapentaenoic acid, reflected in the higher content of these fatty acids in both neutral and polar lipids of the larvae. In summary, KPL were found to be an excellent source of lipids for seabream larvae. Optimum inclusion levels of this ingredient in microdiets to completely substitute live preys at this larval age were found to be 120 g kg−1 KPL.