Damselfish are not nice fish! They are colourful, active and affordable. But they're mean as heck (most of them). They also rarely hide which does make them appealing.
Theyre brave as can be!! They defend their territory vigorously against any size predator they feel is a threat - be it to their sleeping quarters or their food supply.
Their agression grows as they age and if they pair up and start spawning their territory requirements expand and their defence of that territory increases. They come into our systems as colourful, bold little 'model citizens ' but that can quickly change as they get older.
I would personally not risk a spawning pair of any kind of damsel in anything but a very large tank so I personally wouldn't try more than one of anything. Some have seen success with groups of azure but I'm too much a chicken to try even that.
Personally in my limited experience with damsels my opinion is they absolutely won't tolerate being crowded - I feel they need to be able to claim around 30 gal each but that said I don't think they do well in less than 100 gal. I do think they do ok with other species occupying the same space as long as sleeping spots are plentiful and there's enough space to run away if needed.
Mine are in with dwarf angels, tangs, gobies and blennies. They don't like the blennies and gobies and really don't like the chromis. They seem not to even notice the others so far.
I'll be curious to see the updates from anyone who cares to let us know how their damsels do as they get into the 2-3 year range.
Good info everyone.. keep it up!