IkappaB kinase-alpha (IKK-alpha) exhibits protein-kinase-dependent and -independent functions. Its kinase activity is required for lymphoid organogenesis and mammary gland development, whereas a kinase-independent activity is required for epidermal keratinocyte differentiation. In addition to failed epidermal differentiation, IKK-alpha-deficient mice exhibit abnormal skeletal and craniofacial morphogenesis. As similar defects are not exhibited by mice that experience systemic inhibition of NF-kappaB, we postulated that the morphogenetic defects in IKK-alpha-deficient mice are not caused by reduced NF-kappaB activity but instead are due to failed epidermal differentiation that disrupts proper epidermal-mesodermal interactions. We tested this hypothesis by introducing an epidermal-specific Ikka (also known as Chuk) transgene into IKK-alpha-deficient mice. Mice lacking IKK-alpha in all cell types including bone and cartilage, but not in basal epidermal keratinocytes, exhibit normal epidermal differentiation and skeletal morphology. Thus, epidermal differentiation is required for proper morphogenesis of mesodermally derived skeletal elements. One way by which IKK-alpha controls skeletal and craniofacial morphogenesis is by repressing expression of fibroblast growth factor (FGF) family members, such as FGF8, whose expression is specifically elevated in the limb bud ectoderm of IKK-alpha-deficient mice.