Retinoic acid (RA) is involved in vertebrate morphogenesis, growth, cellular differentiation, and tissue homeostasis. The use of in vitro systems initially led to the identification of nuclear receptor RXR/RAR heterodimers as possible transducers of the RA signal. To unveil the physiological functions of RARs and RXRs, genetic and pharmacological studies have been performed in the mouse. Together, their results demonstrate that (a) RXR/RAR heterodimers in which RXR is either transcriptionally active or silent are involved in the transduction of the RA signal during prenatal development, (b) specific RXRalpha/RAR heterodimers are required at many distinct stages during early embryogenesis and organogenesis, (c) the physiological role of RA and its receptors cannot be extrapolated from teratogenesis studies using retinoids in excess. Additional cell type-restricted and temporally controlled somatic mutagenesis is required to determine the functions of RARs and RXRs during postnatal life.