The quake struck just before the close of Tokyo stock trading. Japan's Nikkei average closed at an intraday and five-week low, down 1.7 percent on the day.
The Hong Kong's Hang Seng share index was down 1.8 percent, and Nikkei futures in Singapore tumbled more than 3 percent. At 0650 GMT, Nikkei June futures were down 2.8 percent at 10,075 .
The magnitude 8.9 quake shook buildings in Tokyo, causing "many injuries" and triggered a four-metre (13-ft) tsunami, NHK television and witnesses reported.
The yen extended losses against the dollar after the quake, falling to 83.29 yen to the dollar compared with 82.80 before it struck.
Brent crude held near $115 per barrel as investors monitored developments in the Middle East. Forces loyal to Libyan leader Muammar Gaddafi battled rebels at an oil port, while Saudi police fired in the air to disperse protesting Shi'ites.
Oil prices are up by a quarter this year, with most of the gains coming since the Libyan crisis erupted.
While oil prices around this level posed no substantial threats to the world economy or financial markets, the risk that prices may rise to damaging levels has risen substantially, Barclays Capital strategists said.
Chinese inflation in February remained close to 5 percent, suggesting tighter monetary policy may be needed, adding to the uncertainty.
Key stock indexes in Australia and South Korea closed down more than 1 percent each. The broader Asian market outside Japan was down 1.4 percent, extending its drop by more than 3 percent for the week as fresh outbreaks of violence in the Middle East kept markets on edge.
Weak U.S. economic data spurred some profit taking in shares in developed markets which have enjoyed a handsome run this year, though some bargain buying checked losses.
Overnight, a weak Wall Street which ended down nearly 2 percent. The S&P 500 is up by a third since last July.
"It is another day of reducing risk across the portfolio. We have had it one way for too long and with big issues hitting, everyone is running to the exit at the same time," Chris Weston, an institutional dealer at IG Markets said.
In credit markets, sovereign credit default swap spreads pushed wider, reflecting the general risk aversion sentiment.
Shanghai copper rebounded but was on track to post its biggest weekly loss since May 2010 while London futures
were looking at their worst week since last June, dragged by worries of high oil prices hurting the global economy.
The yield on benchmark 10-year notes slipped to 3.36 percent, down from 3.56 percent hit earlier this month.
In currency markets, the euro stayed weak after having suffered its biggest one-day fall against the dollar in a month, and further losses may loom if a euro zone summit fails to soothe market nerves on sovereign debt.
Any disappointment could heap more pressure on the single currency, which slid to one-week lows near $1.3770 overnight. It last traded at $1.3810.