Many hypotheses have been proposed to explain the molecular mechanism of thalidomide teratogenicity, in particular regarding to limb defects. Most experimental evidence in vivo has been provided for a model that suggests the generation of oxidative stress by thalidomide with subsequent downregulation of Wnt and Akt survival pathways. As a consequence apoptosis is induced during early embryonic limb development resulting in limb truncations. Here we summarize and discuss the relevant data supporting this hypothesis. We extend this model by presenting new data demonstrating an involvement of the transcription factors Tbx5 and Sall4 in thalidomide-induced molecular pathology. Finally, we discuss a possible participation of other stress-responsive and/or pro-apoptotic transcription factors in the mechanism of thalidomide teratogenicity.