Goosecoid (gsc) is an evolutionarily conserved homeobox gene expressed in the gastrula organizer region of a variety of vertebrate embryos, including zebrafish, Xenopus, chicken and mouse. To understand the role of gsc during mouse embryogenesis, we generated gsc-null mice by gene targeting in embryonic stem cells. Surprisingly, gsc-null embryos gastrulated and formed the primary body axes; gsc-null mice were born alive but died soon after birth with numerous craniofacial defects. In addition, rib fusions and sternum abnormalities were detected that varied depending upon the genetic background. Transplantation experiments suggest that the ovary does not provide gsc function to rescue gastrulation defects. These results demonstrate that gsc is not essential for organizer activity in the mouse but is required later during embryogenesis for craniofacial and rib cage development.