Coral transplantation is frequently advocated as a possible means of coral reef rehabilitation. One of the purported benefits of transplantation is a positive effect of transplants on coral recruitment by sexual reproduction of transplants (“seeding”) and/or settlement cues generated by the presence of live coral (“attraction”). However, evidence for this assertion is scarce. Here, we investigated the effect of coral transplantation on larval recruitment. A total of 6,164 fragments of four coral species (acroporids and pocilloporids) were transplanted at three sites in North Sulawesi, Indonesia. Coral recruitment onto limestone settlement plates was examined every 3 months and on concrete structures at the end of the study (≥15 months) in the presence and absence of transplants. Transplant survival after 1 year ranged between 20 and 30% for pocilloporids and between 40 and 80% for acroporids. Transplantation had no consistent effect on the number of coral recruits on the settlement plates or on the concrete structures. Recruitment was relatively high compared to other locations in the region and fluctuated seasonally, with increased rates in all treatments during peaks of reproduction. We conclude that, in the presence of high background recruitment and detrimental environmental conditions, coral transplantation may not be an effective method to boost coral recruitment. The provision of stable substrate for settlement in the form of artificial reefs, combined with improved management to reduce chronic stressors, constitutes a better use of resources.