cripto is the original member of the family of EGF-CFC genes, recently recognized as novel extracellular factors essential for vertebrate development. During the early stages of mouse gastrulation, cripto mRNA is detected in mesodermal cells; later, cripto mRNA is detected only in the truncus arteriosus of the developing heart. Here we describe the in vivo distribution of Cripto protein throughout mouse embryo development and show that cripto mRNA and protein colocalize. By means of immunofluorescence analysis and biochemical characterization, we show that Cripto is a membrane-bound protein anchored to the lipid bilayer by a glycosylphosphatidylinositol (GPI) moiety. We suggest that presentation of Cripto on the cell surface via a GPI-linkage is important in determining the spatial specificity of cell-cell interactions that play a critical role in the early patterning of the embryo.