T cell factor / lymphocyte enhancer factor (Tcf/Lef) transcription factors complex with the transcriptional co-activator beta-catenin to transduce Wnt signals in a variety of developmental systems. The prototypic family member Tcf-1 is highly expressed in T lineage cells. Tcf1-/- mice are defective in cell cycling of early thymocyte stages. Here, we show that the interaction of beta-catenin with Tcf-1 is required for full thymocyte development. This interaction may be established by signals mediated by Wnt1 and Wnt4, leading to increased Tcf-dependent transcriptional activity in thymocytes, as demonstrated in Tcf-LacZ reporter mice. Transduction of fetal thymocytes with Wnt1 and Wnt4 results in increased survival in an in vitro cell culture system. Retroviral expression of soluble Wnt receptor mutants that block Wnt signaling inhibits thymocyte development. These results imply an important role for the Wnt cascade in thymocyte development.