This study aims to improve estimates of dispersal by including information on larval traits, and in particular to explore how larval depth distribution affects connectivity and MPA (marine protected area) functionality in the Baltic Sea. A field survey showed that both invertebrates and fish differed in their larval depth distribution, ranging from surface waters to >100 m. A biophysical model of larval dispersal in the Baltic Sea showed that decreased depth distribution increased average dispersal distance 2.5-fold, decreased coastal retention and local recruitment, and substantially increased connectivity. Together with pelagic larval duration (PLD), depth distribution explained 80% of total variation in dispersal distance, whereas spawning season, and geographic and annual variations in circulation had only marginal effects. Median dispersal distances varied between 8 and 46 km, with 10% of simulated trajectories dispersing 30 to 160 km depending on drift depth and PLD. In the Baltic Sea, the majority of shallow Natura 2000 MPAs are <8 km in diameter. In the present study, only 1 of the 11 assessed larval taxa would have a recruitment >10% within MPAs of this size. Connectivity between MPAs was expected to be low for most larval trait combinations. Our simulations and the empirical data suggest that the MPA size within the Natura 2000 system is considerably below what is required for local recruitment of most sessile invertebrates and sedentary fish. Future designs of MPA networks would benefit from spatially explicit biophysical models that consider dispersal and connectivity for complex circulation patterns and informed larval traits.