The physical characteristics of hydrate‐bearing sediments sampled by pressure coring from the Ulleung Basin in the Sea of Japan (East Sea) were investigated using an instrumented chamber capable of testing recovered natural sediments that have never left the methane hydrate stability field. The heterogeneous distribution of segregated hydrate veins and lens structures in sediments results in highly variable geophysical and geomechanical properties. The scaled production test was conducted by controlled depressurization of pressure cores while dissociation and gas production were concurrently monitored using various sensors in the instrumented chamber. The hydrate saturation was estimated to be ~19.5% in the pore space. Data show a sharp reduction in sediment shear and bulk stiffnesses during hydrate dissociation. Relatively fast gas migration was observed, probably along high‐conduction planes left behind as hydrate veins dissociated. The spatial distribution of hydrates in sediment was analyzed based on 3-D image processing. The phenomena relevant to the production test and sampling effects during pressure coring are discussed.