We demonstrate that conditional ablation of the homeobox transcription factor Cdx2 from early endoderm results in the replacement of the posterior intestinal epithelium with keratinocytes, a dramatic cell fate conversion caused by ectopic activation of the foregut/esophageal differentiation program. This anterior homeotic transformation of the intestine was first apparent in the early embryonic Cdx2-deficient gut by a caudal extension of the expression domains of several key foregut endoderm regulators. While the intestinal transcriptome was severely affected, Cdx2 deficiency only transiently modified selected posterior Hox genes and the primary enteric Hox code was maintained. Further, we demonstrate that Cdx2-directed intestinal cell fate adoption plays an important role in the establishment of normal epithelial-mesenchymal interactions, as multiple signaling pathways involved in this process were severely affected. We conclude that Cdx2 controls important aspects of intestinal identity and development, and that this function is largely independent of the enteric Hox code.