New Zealand fur seals in the New Zealand area are increasing in number following earlier depletion by Polynesians and Europeans. Otago Peninsula, South Island is a region where recent re-colonization has occurred. We identified 27 breeding and 41 non-breeding colonies in 1998. At higher densities the shortage of space in breeding colonies may initiate emigration by first-time breeders to suitable sites nearby. This hypothesis assumes philopatry (repeated return to a natal site) and site fidelity (repeated return to a non-natal site). We quantified the rate of increase in pup production at Otago Peninsula since the early 1980s using annual counts of fur seals ashore from 1994 to 1998 and data on pup numbers before 1994 from the literature. The exponential rate of increase (b) ranged from 0.22 to 0.30 (95% confidence interval) and the average (arithmetic) rate of annual increase (r) was 0.30. To search for evidence of philopatry, site fidelity and immigration, relationships between counts of pups established colonies in 1996–1998 were measured and found to be highly correlated. We then tested whether new breeding colonies were established nearer to existing breeding colonies than would be expected by chance. There was significant spatial clustering of new breeding colonies around the 6 focal (established) colonies. We found no evidence for an association between the appearance of new colonies and r at nearby established colonies. Increasing numbers of fur seals on Otago Peninsula have resulted in the rapid proliferation of colonies, and their clustering is indicative of a ‘spill-over’ effect where young individuals choose to breed near to established breeders.