The human oncogene beta-catenin is a bifunctional protein with critical roles in both cell adhesion and transcriptional regulation in the Wnt pathway. Wnt/beta-catenin signalling has been implicated in developmental processes as diverse as elaboration of embryonic polarity, formation of germ layers, neural patterning, spindle orientation and gap junction communication, but the ancestral function of beta-catenin remains unclear. In many animal embryos, activation of beta-catenin signalling occurs in blastomeres that mark the site of gastrulation and endomesoderm formation, raising the possibility that asymmetric activation of beta-catenin signalling specified embryonic polarity and segregated germ layers in the common ancestor of bilaterally symmetrical animals. To test whether nuclear translocation of beta-catenin is involved in axial identity and/or germ layer formation in 'pre-bilaterians', we examined the in vivo distribution, stability and function of beta-catenin protein in embryos of the sea anemone Nematostella vectensis (Cnidaria, Anthozoa). Here we show that N. vectensis beta-catenin is differentially stabilized along the oral-aboral axis, translocated into nuclei in cells at the site of gastrulation and used to specify entoderm, indicating an evolutionarily ancient role for this protein in early pattern formation.