The appearance of the embryonic shield, a slight thickening at the leading edge of the blastoderm during the formation of the germ ring, is one of the first signs of dorsoventral polarity in the zebrafish embryo. It has been proposed that the shield plays a role in fish embryo patterning similar to that attributed to the amphibian dorsal lip. In a recent study, we fate mapped many of the cells in the region of the forming embryonic shield, and found that neural and mesodermal progenitors are intermingled (Shih, J. and Fraser, S.E. (1995) Development 121, 2755–2765), in contrast to the coherent region of mesodermal progenitors found at the amphibian dorsal lip. Here, we examine the fate and the inductive potential of the embryonic shield to determine if the intermingling reflects a different mode of embryonic patterning than that found in amphibians. Using the microsurgical techniques commonly used in amphibian and avian experimental embryology, we either grafted or deleted the region of the embryonic shield. Homotopic grafting experiments confirmed the fates of cells within the embryonic shield region, showing descendants in the hatching gland, head mesoderm, notochord, somitic mesoderm, endoderm and ventral aspect of the neuraxis. Heterotopic grafting experiments demonstrated that the embryonic shield can organize a second embryonic axis; however, contrary to our expectations based on amphibian research, the graft contributes extensively to the ectopic neuraxis. Microsurgical deletion of the embryonic shield region at the onset of germ ring formation has little effect on neural development: embryos with a well-formed and well-patterned neuraxis develop in the complete absence of notochord cells. While these results show that the embryonic shield is sufficient for ectopic axis formation, they also raise questions concerning the necessity of the shield region for neural induction and embryonic patterning after the formation of the germ ring.