In this study, we have analyzed the expression and function of Gremlin in the developing avian limb. Gremlin is a member of the DAN family of BMP antagonists highly conserved through evolution able to bind and block BMP2, BMP4 and BMP7. At early stages of development, gremlin is expressed in the dorsal and ventral mesoderm in a pattern complementary to that of bmp2, bmp4 and bmp7. The maintenance of gremlin expression at these stages is under the control of the AER, ZPA, and BMPs. Exogenous administration of recombinant Gremlin indicates that this protein is involved in the control of limb outgrowth. This function appears to be mediated by the neutralization of BMP function to maintain an active AER, to restrict the extension of the areas of programmed cell death and to confine chondrogenesis to the central core mesenchyme of the bud. At the stages of digit formation, gremlin is expressed in the proximal boundary of the interdigital mesoderm of the chick autopod. The anti-apoptotic influence of exogenous Gremlin, which results in the formation of soft tissue syndactyly in the chick, together with the expression of gremlin in the duck interdigital webs, indicates that Gremlin regulates the regression of the interdigital tissue. At later stages of limb development, gremlin is expressed in association with the differentiating skeletal pieces, muscles and the feather buds. The different expression of Gremlin in relation with other BMP antagonists present in the limb bud, such as Noggin, Chordin and Follistatin indicates that the functions of BMPs are regulated specifically by the different BMP antagonists, acting in a complementary fashion rather than being redundant signals.