This study deals with the market analysis of chitosan and its derivatives in Japan. Japan is a world leader in this field (including industry and R&D). We have analysed chitosan market trend in Japan in order to prospect the technology and market trend in Korea indirectly. Chitosan and its derivatives were mainly used as an additive to functional food. However R&D activities in various application fields are being carried out. Chitosan (including its oligosaccharide) and glucosamine had shown similar market size in 2003. After market analysis, we can find out chitosan market are decreased and glucosamine market are increased respectively. As a result of chitosan related market analysis, we can find out that glucosamine market revenues are projected to maintain ?4,000 million in 2011, which is four times size of chitosan market.