Japanese students often feel it difficult to acquire communicative skills in English at school. Although many of them appear to have positive, favorable attitudes towards learning English, their annual Test of English as a Foreign Language (TOEFL) total score means has been consistently low. The present paper discusses this paradox from two points of views, pedagogical and cultural. First, some features of TEFL in Japanese schools are highlighted. TEFL starts late (at junior high school), the class hours per week are comparatively few, and classes are large. In addition, while communicative language teaching (CLT) has been formally adopted, teachers and students are still conscious of grammar-translation skills, particularly because of their prominence in University entrance examinations. Second, certain aspects of Japanese communication styles have significant effects on students' motivation to learn English and their preferred modes of communication in English. These include "dual structured" communication, implied meanings, tacit understanding, and sensitivity to social and contextual factors such as formality, status, power, and social distance. This paper presents the results of a study on aspects of formality and politeness in the use of English by Japanese teachers and students, and concludes by discussing recent developments and future prospects.