Cripto is a cell surface protein highly expressed in certain solid tumors, and overexpression of Cripto protein is oncogenic. Cripto-1 protein is encoded by CRIPTO1 gene. CRIPTO3, a presumed pseudogene, has an open reading frame with six amino acid differences from Cripto-1. We show that CRIPTO3 mRNA is the CRIPTO message expressed in many cancer samples. A CRIPTO3 SAGE tag was found in several cancer SAGE libraries, while the CRIPTO1 tag was found in ES cell libraries. In vitro experiments indicate both Cripto-1 and Cripto-3 proteins are functional in the Nodal-dependent signal pathway. Our data indicate that CRIPTO3 is an expressed gene, particularly in certain cancers, and suggest a potentially novel mechanism of oncogenesis through activation of a retrogene.