However, he had already begun to exhibit signs of literary talent, and his first novel Kappan-ya no Hanashi ("Tale of a Printer's Shop") was published when he was 16.

This novel won a prize in a competition and was highly praised by the well-known author and editor, Kikuchi Kan. Due to this encouragement, Nagai devoted his energies to writing, submitting a stage play to the Imperial Garden Theater in 1923, and publishing Kuroi Gohan ("Black Rice") in Bungeishunjū, a monthly literary journal founded by Kikuchi Kan.

During this time, he helped to lay the foundations for the Akutagawa and Naoki Prizes, created in 1935, and later became a member of the screening committee.

In April 1943, Nagai traveled to Xinjing, the capital of Manchukuo to establish an independent branch of the Bungeishunjū, returning to Tokyo in March 1945 to assume the post of executive director to the magazine.

However, due to his wartime activity as a correspondent, Nagai was purged from public service by the American occupation authorities after World War II.