The Nikkei 225 index has closed at 10,366.34, down 146.48 points.
Dealers say fallers included technology stocks after declines on Wall Street overnight and concerns over profits warnings.
The dollar was at 121.94 yen in Tokyo trading, down from 121.98 in late New York trading; and at 0.9067 against the euro, compared with 0.9046 in New York.
Government bond yields were lower, with the no 233 issue yielding 1.27 per cent; and the no 234 issue at 1.32 per cent.
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The US 30-year bond was at 102-18/32, yielding 5.205 per cent, compared with 102-11/32, yielding 5.22 per cent, in late New York trading.
AP