In many industrial nations, the processes of transition from education or training to employment are very important. Using Japan as a case study, this article considers these processes from an external perspective. The main criterion used is the issue of stratification within the education and training system. A detailed analysis of the transition process demonstrates that there is little differentiation between school students in Japan, making Japan's a very homogeneous education system by comparison with its international competitors. However, a type of "indirect and/or informal" stratification results from a ranking system for educational establishments and employers, reinforced by cooperation between individual educational establishments and specific employers. (Contains 1 figure, 1 table, and 8 notes.)