In its worst day since March 14, the Nikkei benchmark slipped 3.0 per cent to close at 16,883.19, not far off a six-week low of 16,672.94 hit on December 17.
With oil prices at their lowest since spring 2009, the Tokyo Stock Exchange sub-index of oil and mining shares tumbled 5.5 percent. Inpex Corp shed 5.8 per cent.
Exporters' shares suffered from a stronger yen, which broke through the 119 level versus the dollar late in the session. Nissan Motor Co Ltd lost 4.4 percent and Panasonic Corp slipped 3.1 per cent.
The broader Topix fell 2.9 per cent to 1,361.14, while the JPX-Nikkei Index 400 shed 2.9 percent to close at 12,327.80.
Copyright: Thomson Reuters 2015