Japan is the other great center for hot springs -- on whole, the undisputed champion of the world. Mineral water is seeping out of everywhere. Japan, when you get down to it, isn't much more than a bunch of volcanos connected by shinkasen and conbini.
In alot of ways Japan has no equal. Other parts of the world have, at best, dozens or springs, while Japan has hundreds. They are also pristinely clean, and usually done in good taste. If you look hard, there is also great variety: Baths of many different colors and power, mud baths, and add-ons like sand baths and even all-out bath theme parks.
The tradeoffs. There is, nowadays, too much uniformity among Japan's Onsen. There are hundreds of great baths, but too often one can seem identical to another, as alike as two cars on the Yanamoto line. That's good in the sense that good baths are readibly available and consistent. But sometimes you really need to push hard to find a truly unusual or memorable bath (though they definitely exist).
Second, some of the most spectacular places are also spectacularly expensive -- the ryokan baths in particular. In the United States, hot springs are sort of an unusual hobby, keeping demand down, but in Japan, just about everyone loves their onsen.
Finally, most japanese baths are gender-segregated (some exceptions discussed below), so its more about silent contemplation than chatting with any friends or partners of the opposite sex.
There are certain parts of Japan where there are just high numbers of great Onsen (like near Nagano).
What follows is extremely incomplete. I simply haven't spent enough time in Japan - yet - to visit all of the great onsen areas. If you are serious about this,I am a devotee of the book, by Robert Neff, entitled Japan's Hidden Hot Springs. Neff's springs aren't the fanciest and while many are famous, they often aren't the most famous. But he has found the places with a true soul and that's the greatest challenge in today's Japan.
So here are some places I have been.
Hokaido
I did an onsen tour in hokkaido - coupled with some mountain hiking - that I regard as one of the best times of my life. And along the way I had the chance to drop by a few memorable Onsen.
In general hokkaido does not have the traditional japanese style Ryokan / Onsen that you might be hoping for. But what hokkaido onsens do have is mountain charm, dramatic landscapes, and a remoteness that can't be beat.
Naka-dake Onsen
This wild onsen can scarcely be found in the books. Yet it is a fabulous wild onsen that is part of one of the best hikes you'll find in Japan or anywhere.
This spring is located in Daikatzakan national park, Japan's largest national park. It forms part of a trail that crosses Hokaido's tallest peak, dramatic Asahi-dake (pictured below). The spring itself can be visited as part of a 7 hour hike that climbs Asahi-dake, circles a nearby crater, and descends into the valley where the spring can be found.
The setting could scarcely be better: a stone lined valley surrounds the spring, which is fed by natural pools and is a beautiful chromatic blue. The spring is acidic but not dangerous.

Yamanouchi Town, Nagano - Monkey Hot Springs
In Nagano prefecture there's a great place to watch the monkeys hang out in the hot springs. (Jigokudani Yaen Koen). It is so inspirational that you'll easily spend hours there. The monkeys basically eat, sit in the bath, and go for some monkey-shiatsu (grooming). They really seem to have life figured out.
Since the monkeys are similar to us, you can learn alot from them. But once you see the o-saru-san soaking you'll want to go yourself. I can't remember the name of the one I went to unfortunately, but it was a nice Ryokan.
Note that most places segregate between man, woman, and monkey. If it has always been your dream to sit in a hot spring with a monkey you may have to go somewhere else.


Yakushima - Kaichu Beach Springs
The island of Yakushima is off the South of Japan, and is home to giant cedar trees that the Japanese claim to be more than 7,000 years old. Well that's true or not, Yakashima like everywhere else also has a few hot springs. Not the best in japan but memorable in a different way -- they are free, open to the public, and natural.
The location cannot really be beat, and is especially memorable at night. Also unusual for Japan, men and women are unsegregated, or segregated only by a kind of screen, so if you're particularly modest keep that in mind.

Beppu - Mud Springs
Beppu is famous for springs, but also overrun with tourists, gimicky stuff, and bland onsen places. However there are certainly some interesting places, such as sand onsen, and especially the mud springs north of town. The mud springs I visited were a bit run down, but lying in the hot mud is pretty memorable.
This fellow spent 3 weeks in Beppu doing nothing but going to springs, so maybe you should follow his advice.
[Mud Springs, Beppu]
Oedo Onsen Monogatari, Odaiba, Tokyo
Okay, so no purist would include this place in any list of onsens. It as to great Onsen as Rocky is to Raging Bull, or as Disneyland is to the Loire Valley. But it has a kitchy, only-in-japan feel that is irresistable to people like me.
At the entrance are large "no tattoo" signs. (people break this rule). Inside you have to wear Yukata -- you get to choose between 18 or so outfits.
Inside, the onsen has tried to recreate the look and feel of an Edo-era town. Since everyone's in costume, it works a little better than you might think (see below). People look good in Yukata, as you'll know if you ever go to fireworks in Japan.
Inside you can eat various things, throw shuriken, fire a bow, or do one of a hundred other odd things. Friendly ninjas, right out of daredevil, help out.
The baths themselves are okay, but obviously not up to the level of the better onsen. They are similar to the baths in the Tokyo Dome / Big Egg. Nice materials, basically, but no real charm. However, cold pools, hot, outdoor, everything you'd like
One memorable feature is the foot onsen, an outdoor onsen that is a "path of health" for the feet (see below). Basically you walk on a bumpy surface creating great pain for your feet while they are under water.
One of the oddest parts about Oedo Onsen is that you can, spur of the moment, spend all night there. (Much cheaper than taking a taxi home!). I did this once, and slept in a giant back room on tetami with all of the ヤンケエ。 It was an unusual evening.
[Foot Onsen. Photo Credit Buck82]
[Odeo Onsen]