In zebrafish, the program for dorsal specification begins soon after fertilization. Dorsal determinants are localized initially to the vegetal pole, then transported to the blastoderm, where they are thought to activate the canonical Wnt pathway, which induces the expression of dorsal-specific genes. We identified a novel maternal-effect recessive mutation, tokkaebi (tkk), that affects formation of the dorsal axis. Severely ventralized phenotypes, including a lack of dorso-anterior structures, were seen in 5-100% of the embryos obtained from tkk homozygous transmitting females. tkk embryos displayed defects in the nuclear accumulation of beta-catenin on the dorsal side, and reduced or absent expression of dorsal-specific genes. Mesoderm and endoderm formation outside the dorsal axis was not significantly affected. Injection of RNAs for activated beta-catenin, dominant-negative forms of Axin1 and GSK3beta, and wild-type Dvl3, into the tkk embryos suppressed the ventralized phenotypes and/or dorsalized the embryos, and restored or induced an ectopic and expanded expression of bozozok/dharma and goosecoid. However, dorsalization by wnt RNAs was affected in the tkk embryos. Inhibition of cytoplasmic calcium release elicited an ectopic and expanded expression of chordin in the wild-type, but did not restore chordin expression efficiently in the tkk embryos. These data indicate that the tkk gene product functions upstream of or parallel to the beta-catenin-degradation machinery to control the stability of beta-catenin. The tkk locus was mapped to chromosome 16. These data provide genetic evidence that the maternally derived canonical Wnt pathway upstream of beta-catenin is involved in dorsal axis formation in zebrafish.