[ivyart]

I recommend the oxford collection of SS that takes you through the Meiji Restoration to pretty near now. Then there is the collection of Japanese Modernism edited by Donald Keene. There is a small collection but very nice selection: Autumn Wind and other Stories. There is a definite book to avoid: Monkeybrain Sushi. If you are tempted, read and pay attention to the introduction.
FOr individual writers as mentioned here some great ones include:
Natsume Soseki
Junichiro Tanizaki
Mori Ogai***
Yukio Mishima
Motojiro Kajii
Yasunari Kawabata
Nagai Kafu
and Kobo Abe.

If you venture into Oe Kenzaburo read his Teach Us To Outgrow Our Madness first.

After this little list you can laugh at and understand why the Japanese consider Murakami fans to not read/think much.