Because small vampire squids occupy deeper water than larger squids, spawning probably occurs in very deep water. It is most likely that males transfer spermatophores to the female from their funnel. The female vampire squid is larger than the male and discharges the fertilized eggs directly into the water. Mature eggs are fairly large at 3-4mm in diameter and are found free-floating in small masses in deep water.
(Grzimek 1972, Young 1999)