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Japan underwent rapid economic expansion as well as economic development after the War. However, since 1990s, the country faced long recession and the increase in social and economic inequality. During such time, education policy also shifted toward favoring differentiated curriculum and choice-based system. The purpose of this paper is to reveal how the relationship between family background and students’ academic achievement has changed over time in Japan in the recent decade. Using the Third International Mathematics and Science Study (TIMSS), the study applies hierarchical linear modeling and examine the proportion of between-school variance in academic achievement as well as the effect of family background on achievement over time. As a result, the study found evidence on increase educational inequality in Japan during this decade. This paper suggests that changes in educational policy, such as ensuring equal opportunity and providing adequate resources to schools may be necessary to reduce such growing educational inequality in Japan.