In modern Japanese, ateji (当て字, 宛字 or あてじ; pronounced [ate(d)ʑi]; "assigned characters") principally refers to kanji used to phonetically represent native or borrowed words with less regard to the underlying meaning of the characters. This is similar to man'yōgana in Old Japanese. Conversely, ateji also refers to kanji used semantically without regard to the readings.

For example, the word "sushi" is often written with its ateji "寿司". Though the two characters have the readings 'su' and 'shi' respectively, the character '寿' means "one's natural life span" and '司' means "to administer", neither of which has anything to do with the food. Ateji as a means of representing loanwords has been largely superseded in modern Japanese by the use of katakana, although many ateji coined in earlier eras still linger on.

Ateji today are used conventionally for certain words, such as '寿司' ('sushi'), though these words may be written in hiragana (especially for native words), or katakana (especially for borrowed words), with preference depending on the particular word, context, and choice of the writer. Ateji are particularly common on traditional store signs and menus. For example, "tempura" may be written as '天麩羅'. The Japanese loanword for "coffee" is generally written using the katakana 'コーヒー', but on coffee shop signs and menus it may be written with the Chinese word "珈琲", which is then pronounced irregularly to their normal Japanese reading (their kun'yomi). In particular, ateji are frequently employed in manga and song lyrics by pairing kanji with furigana for creative effect and to add layers of meaning.

Many characters have gained meanings derived from ateji usage. For example, ateji were once widely utilized for foreign place names; such as in the ateji "ajia" (亜細亜) used to write "Asia". The original ateji word is now considered archaic, but the character '亜' has gained the meaning "Asia" in such compounds as "tōa" (東亜, East Asia), even though '亜' originally meant "sub-par" (and continues to). From the ateji "Amerika" (亜米利加, America), the second character was taken, resulting in the semi-formal coinage "Beikoku" (米国), which literally translates to "rice country" but means "United States of America"; however, "アメリカ" remains in far more common use in modern Japanese. Major natural gas companies in Japan use the ateji "gasu" (瓦斯, gas) in their company names, but use the katakana "ガス" in their trade names.

When using ateji to represent loanwords, the kanji are sometimes chosen for both their semantic and phonetic values, a form of phono-semantic matching. A stock example is '倶楽部' ("kurabu") for "club", where the characters can be interpreted loosely in sequence as "together", "fun" and "place". Another example is '合羽' ("kappa") for the Portuguese capa, a kind of raincoat. The characters can mean "wings coming together", as the pointed capa resembles a bird with wings folded together.

The ad hoc usage of Chinese characters for their phonetic values dates nearly to the introduction of Chinese characters to Japan. Two widespread uses of ateji came out of this. On one front, scholars and monks used kanji characters as translation aids between the lines of Chinese texts. On the other, poets simply used kanji phonetically to write in Japanese. Many different characters were used with the same sound values. This system of characters is called man'yōgana (万葉仮名), "alphabet of myriad leaves". The kana of modern Japanese, hiragana and katakana developed as organic simplifications of man'yōgana that were eventually codified.

Ateji are primarily used today for historical terms – in historical order, these are primarily Sanskrit terms dating from the introduction of Buddhism to Japan, Portuguese terms from the 16th and 17th centuries, and Dutch terms from the 17th, 18th, and 19th centuries. Ateji found some use in the Meiji period and in the 20th century, but has largely been superseded by katakana.

In Buddhist Japanese, Sanskrit terms used in some chants also derive from ateji but were not called such. These Buddhist texts were translated into Chinese (in a Literary Chinese style) in China long ago. The translation rule for mantras was not to translate the mantra, but instead to represent it phonetically with Chinese characters. For the sutras, they were translated into Chinese Literary Language (Wenyan). The terms prajñāpāramitā (hannya-haramitta (般若波羅蜜多)) and samyaksaṃ-bodhi (sanmyakusanbodai (三藐三菩提)), or "perfection of wisdom" and "fully enlightened", both appear in the Heart Sutra, but are written using ateji.