Late summer counts of juveniles at sea are used as an index of Marbled Murrelet (Brachyramphus marmoratus) reproductive success, but little is known about juvenile dispersal or habitat use. Further, it is not known whether these counts accurately reflect absolute breeding success. To address these questions we conducted five boat surveys for Marbled Murrelets and Pigeon Guillemots (Cepphus columba) in Kachemak Bay, Alaska between 7-24 August 1996. Juvenile murrelet distribution in the bay was patchy, and we identified a juvenile Marbled Murrelet 'nursery' area in the outer bay. Fifty-three of 61 juvenile murrelets were in this area, whereas after-hatch-year (AHY) murrelets were dispersed throughout the bay, as were juvenile and AHY Pigeon Guillemots. The murrelet nursery was characterized by water inside of or at the edge of a 20 m deep contour, semi-protected seas, productive waters, and a large bed of Nereocystis kelp. Juveniles comprised 16.1% of all murrelets and 24.8% of all guillemots observed at sea. These data suggest a maximum reproductive success of 0.32 chicks/pair if all AHY murrelets were breeding and 0.46 chicks/pair if only 70% of AHY murrelets were breeding. For guillemots, maximum productivity estimated from at-sea counts was 0.50 chicks/pair if all AHY were breeding and 0.71 chicks/pair if only 70% were breeding. The guillemot estimate was similar to that obtained by concurrent studies at nine guillemot colonies in the bay (0.56 chicks/pair). These results suggest that at sea surveys in late summer provide a reasonable index of local productivity for nearshore alcids. Further, if murrelet nursery areas can be found, at sea counts may provide a valid measure of absolute productivity.