Foreign direct investment has been an important pillar of Japan’s economic policy over the past 20 years. However, the imbalance in Japan’s foreign investment and the low level of investment per GDP remain major issues. The focus of Japanese policy on investment in Japan has gradually begun to change from investment deregulation by the central government in the 1990s to investment promotion activities by regional governments. On the other hand, the equal levels of outflow and inflow have been evident in recent foreign investment activity in Japan, and the sustainability of investments has become the essential challenge for Japan’s markets. The latter section of this paper analyzes the structural changes of foreign investment business activity in Japan in recent years using various statistics, and highlights issues and outlooks regarding the sustainability of investments and their contribution to the Japanese economy.