Some haphazard defending from Luis Milla's team cost them dear as the first-half strike gave the underdogs a dream start and provided the first big shock of the tournament
Kensuke Nagai and Hiroshi Kiyotake could have made it a more comfortable win for Takashi Sekizuka's side as both wasted good chances either side of half-time, but their opponents struggled to trouble Shuichi Gonda in the Japan goal, particularly after Inigo Martinez's sending-off at the end of the first half.
Spain produced the first goalscoring opportunity of the game in the fourth minute when Juan Mata played in Rodrigo with a neat pass. The former Bolton striker shifted the ball onto his left foot before dragging a shot just wide 15 yards from goal.
Midway through the first half, Mata came close to breaking the deadlock with a swirling effort from distance, after cutting in from the right-hand side on to his favoured left foot, which Gonda did well to palm away to safety.
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Japan took a surprise lead in the 34th minute through Otsu after he ghosted in at the back post to divert Takahiro Ogihara's inswinging corner from the left past a stranded David de Gea in the Spain goal. Right-back Martin Montoya's failure to pick the scorer up had gifted the chance to his opponent.
Sekizuka's side nearly increased their lead just minutes later when a terrible attempted back-pass from Alvaro Dominguez to De Gea went straight to Hiroshi Kiyotake inside the Spain penalty area. Kiyotake did well to jynx past the goalkeeper but, in doing so, took the ball far too wide for a clear shot on goal, and his eventual effort drifted harmlessly out.
Less than two minutes after their first booking (a Jordi Alba elbow), Spain were reduced to 10 men when Inigo Martinez was shown a straight red card by the referee, Mark Geiger, for obstructing a clear goalscoring opportunity for Nagai as the Japan striker broke towards the penalty area.
The leaders started the second half at a canter, with Keigo Higashi prompting a brilliant save from De Gea after curling a right-foot shot towards the top right corner from 20 yards out.
The Spanish defence was exposed once again shortly after, with Nagai coming within inches of making it 2-0 after latching on to a decent through-ball from Hotaru Yamaguchi on the right and slotting a right-footed effort just wide of the left-hand post. Kiyotake then shot wide from a similar position minutes later.
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Despite the quality of their passing improving, Spain failed to create any clear-cut chances in the second half, with a firm Alba effort from an acute angle that Gonda deflected away the closest that they came to drawing level as Japan eased to victory.
The Japanese nearly added a confirmation goal in the dying moments of the game as the outstanding Nagai raced through and sent a left-footed shot goalwards which De Gea did superbly to keep out.
Both sides' next Group D fixture is on Sunday at the Sports Direct Arena, as Japan play Morocco at 16:00BST, while Spain take on Honduras later on in the afternoon at 18:45BST.