Exposure to dioxins, including 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD), causes a wide array of toxicities in vertebrates, which are mostly considered to be mediated through the inappropriate activation of the aryl hydrocarbon receptor (AHR) signaling pathway. Although transcriptional regulation by AHR is widely studied, the molecular mechanisms responsible for the adverse outcomes after AHR activation are largely unknown. To identify the important downstream events of AHR activation, we employed the zebrafish caudal fin regeneration model, where AHR activation blocks the regenerative process. Comparative toxicogenomic analysis revealed that both adult and larval fins respond to TCDD during regeneration with misexpression of Wnt signaling pathway members and Wnt target genes. R-Spondin1, a novel ligand for the Wnt coreceptor, was highly induced, and we hypothesized that misexpression of R-Spondin1 is necessary for AHR activation to block regeneration. Partial antisense repression of R-Spondin1 reversed the inhibitory effect of TCDD, and tissue regeneration was restored. This finding demonstrates that inhibition of regeneration by TCDD is mediated by misinduction of R-Spondin1. Because R-Spondin1 signals through the Wnt coreceptor LRP6, we further demonstrated that the TCDD-mediated block in regeneration is also LRP6 dependent. Collectively, these results indicate that inappropriate regulation of R-Spondin/LRP6 is absolutely required for TCDD to inhibit fin regeneration.