Krüpple-like factors (Klfs) are highly conserved zinc-finger transcription factors that regulate various developmental processes, such as haematopoiesis and cardiovascular development. In zebrafish, transient knockdown analysis of biklf/klf17 using antisense morpholino suggests the involvement of biklf/klf17 in primitive erythropoiesis and hatching gland development; however, the continuous physiological importance of klf17 remains uncharacterized under the genetic ablation of the klf17 gene among vertebrates. We established the klf17-disrupted zebrafish lines using the CRISPR/Cas9 technology and performed phenotypic analysis throughout early embryogenesis. We found that the klf17-deficient embryos exhibited abnormal lateral line neuromast deposition, whereas the production of primitive erythrocytes and haemoglobin production were observed in the klf17-deficient embryos. The expression of lateral line neuromast genes, klf17 and s100t, in the klf17-deficient embryos was detected in posterior lateral line neuromasts abnormally positioned at short intervals. Furthermore, the klf17-deficient embryos failed to hatch and died without hatching around 15 days post-fertilization (dpf), whereas the dechorionated klf17-deficient embryos and wild-type embryos were alive at 15 dpf. The klf17-deficient embryos abolished hatching gland cells and Ctsl1b protein expression, and eliminated the expression of polster and hatching gland marker genes, he1.1, ctsl1b and cd63. Thus, the klf17 gene plays important roles in posterior lateral line neuromast and hatching gland development.