This study investigates employee perceptions of job training and rotations in Japanese manufacturing organizations. An attention is focused on the issue of how on-the-job training and job rotations operate in Japanese organizations, and whether these work activities motivate Japanese employees. The results from an analysis of qualitative data obtained from 40 Japanese employees suggest that on-the-job training and job rotations operate without causing major employee dissatisfaction, despite the fact that employees receive no substantive rewards for thesework activities. Institutional factors embedded in the workplace, such as normsgoverning co-worker relations, appear to be important prerequisites for sustaining the system of skill formation in Japan. The results also indicate that on-the-job training and job rotations do not necessarily enhance employees work motivation. Japanese employees tend to view co-worker training as burden. Job rotations seem to discourage employees when they are obliged to move against theirwill.