In marine systems, oxygen availability varies at small temporal and spatial scales, such that current oxygen levels may not reflect conditions of the past. Different studies have shown that marine invertebrate larvae can select settlement sites based on local oxygen levels and oxygenation history of the biofilm, but no study has examined the interaction of both. The influence of normoxic and hypoxic water and oxygenation history of biofilms on pre-settlement behavior and settlement of the bryozoan Bugula neritina was tested. Larvae used cues in a hierarchical way: the oxygen levels in the water prime larvae to respond, the response to different biofilms is contingent on oxygen levels in the water. When oxygen levels varied throughout biofilm formation, larvae responded differently depending on the history of the biofilm. It appears that B. neritina larvae integrate cues about current and historical oxygen levels to select the appropriate microhabitat and maximize their fitness.