Japanese society is ethnically and linguistically homogeneous, with small populations of primarily Ryukyuans (1.5 million), North and South Koreans (1 million), Chinese and Taiwanese (0.5 million), Filipinos (0.5 million), and Brazilians — mostly of Japanese descent — (250,000), as well as the indigenous Ainu minority in Hokkaido. About 99% of the population speaks Japanese as their first language.

Japanese citizenship is conferred on an infant when a family member registers the infant's birth in the family registry held by a neighborhood ward office. Simply being born in Japan does not assure citizenship. Monolingual Japanese-speaking minorities often reside in Japan for generations under permanent residency status without acquiring citizenship in their country of birth. People of Japanese heritage returning from overseas have citizenship if their birth in a foreign country was registered in Japan on their behalf by a family member. Sometimes these returnees are not considered truly Japanese and suspected of being descendants of the Burakumin "unclean" caste of feudal times, a group of people known to have immigrated to South American countries. Thus, they have been subject to discrimination.

Shopping in Ginza

The Japanese population is rapidly aging, the effect of a post war baby boom followed by a decrease in births as the country modernized in the latter part of the 20th century (notable aspects including the shift from agricultural to urban lifestyles and the increasing tendency for women to remain in the workplace). Japan has the highest life expectancy in the world (85.2 years for women and 78.3 years for men in 2002. By 2007, over 20% of the population will be over the age of 65. The changes in the demographic structure have created a number of social issues, particularly a potential decline in the workforce population and increases in the cost of social securities like the public pension plan.

The population started declining in 2005, as the 1.067 million births were exceeded by the 1.077 million deaths. Assuming current birth and death rates, the 2005 population of 128 million will decline to 100 million in 2050, and 64 million in 2100-- and keep falling. The main problem will be the financial crisis that comes from having a higher and higher dependency ratio (nonworking young and old compared to working ages.) Demographers and government planners are currently in a heated debate over how to cope with this problem. Immigration and birth incentives are sometimes suggested as a possible solution to provide younger workers to support the nation's aging population. Immigration, however, is not publicly popular as recent increased crime rates are often attributed to foreigners living in Japan.