The present invention relates to an improved design and layout for hatchery seed production of mud crab species and process of production thereof. The layout encompassing various partitioned sections such as broodstock tanks, hatching tanks, larval rearing tanks, live feed tanks that includes rotifer tanks, algal tanks, artemia hatching tanks & artemia biomass tanks, live feed stock room, an aeration system and sea water reservoirs. The process of production of hatchery seed of mud crab species involves collection of broodstock, transportation of broodstock to the hatchery, quarantining of brooder crabs, maintenance of broodstock, selection of brooder for seed production, spawning, hatching, larval rearing, feed management, water management, monitoring of larvae and harvesting of crab instar.