In Xenopus, normal mesoderm formation depends on signaling through the fibroblast growth factor (FGF) tyrosine kinase receptor. An important signaling pathway from receptor tyrosine kinases involves Ras/Raf/MAP kinase. However, the downstream pathway that occurs in the nucleus to finally trigger gene expression for mesoderm formation remains unknown. We report here that a high level of activator protein-1 (AP-1)-dependent transcriptional activity is detected during the early development of Xenopus embryos. Injection of a dominant negative mutant jun (DNM-jun or TAM67) RNA into the two-cell stage embryos inhibited endogenous AP-1 activity and blocked normal embryonic development with severe posterior truncation in tadpoles. The inhibition of AP-1 activity and the phenotypic change induced by TAM67 was rescued by co- injection of wild-type c-jun RNA, but not by the control β-galactosidase RNA. The FGF-stimulated mesoderm induction was markedly inhibited in animal cap explants from the embryos injected with TAM67. Activin induction of mesoderm, on the other hand, was normal in the embryos injected with TAM67 RNA. These findings suggest that AP-1 mediates FGF, but not activin, receptor signaling during mesoderm induction and the AP-1/Jun is a key signaling molecule in the development of posterior structure.