We have used a probe specific for the Xenopus homologue of the mammalian proto-oncogene int-2 (FGF-3) to examine the temporal and spatial expression pattern of the gene during Xenopus development. int-2 is expressed from just before the onset of gastrulation through to prelarval stages. In the early gastrula, it is expressed around the blastopore lip. This is maintained in the posterior third of the prospective mesoderm and neuroectoderm in the neurula. A second expression domain in the anterior third of the neuroectoderm alone appears in the late gastrula, which later resolves into the optic vesicles, hypothalamus and midbrain-hindbrain junction region. Further domains of expression arise in tailbud to prelarval embryos, including the stomodeal mesenchyme, the endoderm of the pharyngeal pouches and the cranial ganglia flanking the otocyst. It is shown, by treatment of blastula ectoderm with bFGF and activin, that int-2 can be expressed in response to mesoderm induction. By heterotypic grafting of gastrula ectoderm into axolotl neural plate, we have also demonstrated that int-2 can be expressed in response to neural induction. These results suggest that int-2 has multiple functions in development, including an early role in patterning of the anteroposterior body axis and a later role in the development of the tail, brain-derived structures and other epithelia.