Life-cycle transitions connecting larval and juvenile stages in metazoans are orchestrated by neuroendocrine signals including neuropeptides and hormones. In marine invertebrate life cycles, which often consist of planktonic larval and benthic adult stages, settlement of the free-swimming larva to the sea floor in response to environmental cues is a key life cycle transition. Settlement is regulated by a specialized sensory-neurosecretory system, the larval apical organ. The neuroendocrine mechanisms through which the apical organ transduces environmental cues into behavioral responses during settlement are not yet understood. Here we show that myoinhibitory peptide (MIP)/allatostatin-B, a pleiotropic neuropeptide widespread among protostomes, regulates larval settlement in the marine annelid Platynereis dumerilii. MIP is expressed in chemosensory-neurosecretory cells in the annelid larval apical organ and signals to its receptor, an orthologue of the Drosophila sex peptide receptor, expressed in neighboring apical organ cells. We demonstrate by morpholino-mediated knockdown that MIP signals via this receptor to trigger settlement. These results reveal a role for a conserved MIP receptor-ligand pair in regulating marine annelid settlement.