The cyclic nonapeptides, oxytocin and vasopressin, are neurohypophysial hormones that regulate many significant physiological processes related especially to reproduction and osmoregulation. In this study, we characterized an oxytocin-related peptide cDNA from a urochordate, Styela plicata, thought to be a sister group to vertebrates. Sequence analysis of the deduced precursor polypeptide revealed that the precursor is composed of three segments; a signal peptide, an oxytocin-like sequence flanked by a Gly C-terminal amidation signal and a Lys–Arg dibasic processing site, and a neurophysin domain, similar to other oxytocin/vasopressin family precursors. However, unlike other members of this family, the tunicate oxytocin-like peptide (CYISDCPNSRFWST-NH₂) is a tetradecapeptide. We termed this peptide Styela oxytocin-related peptide (SOP). Furthermore, analyses of mass spectrometry, in situ hybridization and immunohistochemistry demonstrated production of mature SOP in the cerebral ganglion. To elucidate the physiological action of SOP, we kept the tunicate for two days under the three different concentrations of sea water: 60%, 100% and 130% and measured the expression levels of SOP mRNA in the cerebral ganglion. Greatest expression of SOP mRNA was observed in the 60% sea water. In 60% sea water, but not in 100% or 130%, the tunicate mostly closed the atrial and branchial siphons. Therefore, we investigated the contractile effects of SOP on the siphons in vitro. SOP caused contractions in both siphons in a dose-dependent manner. Taken together, these results suggest that SOP acts to prevent the influx of low concentration of sea water into the body and thus play an important role in osmoregulation.