This article examines the historical development and contemporary status of Japanese language institutes catering for international students in Japan (nihongo gakkō; hereafter ‘JLIs’), highlighting their ambiguous positioning in the landscape of international education. It outlines the dramatic growth and shift in JLI student profiles since 2010 by reference to changes in policy and market dynamics, including the evolution of transnational recruitment channels and the emergence of JLI students as an important source of unskilled labour. Drawing on both secondary data and interviews with JLI teachers and students, the article sheds light on the struggle to reconcile competing educational and managerial priorities, as well as the difficulty of formulating effective policy responses in the absence of a comprehensive regulatory regime or a unified industry lobby. This analysis of JLIs problematises the assumptions and institutional categories employed in mainstream studies of international higher education, and encourages a reconfiguration of traditional frames for understanding Japanese language education, student mobility, and the foreign labour market, all of which are major policy issues in Japan today.