Ethanol exposure during prenatal development causes fetal alcohol spectrum disorder (FASD), the most frequent preventable birth defect and neurodevelopmental disability syndrome. The molecular targets of ethanol toxicity during development are poorly understood. Developmental stages surrounding gastrulation are very sensitive to ethanol exposure. To understand the effects of ethanol on early transcripts during embryogenesis, we treated zebrafish embryos with ethanol during pre-gastrulation period and examined the transcripts by Affymetrix GeneChip microarray before gastrulation. We identified 521 significantly dysregulated genes, including 61 transcription factors in ethanol-exposed embryos. Sox2, the key regulator of pluripotency and early development was significantly reduced. Functional annotation analysis showed enrichment in transcription regulation, embryonic axes patterning, and signaling pathways, including Wnt, Notch and retinoic acid. We identified all potential genomic targets of 25 dysregulated transcription factors and compared their interactions with the ethanol-dysregulated genes. This analysis predicted that Sox2 targeted a large number of ethanol-dysregulated genes. A gene regulatory network analysis showed that many of the dysregulated genes are targeted by multiple transcription factors. Injection of sox2 mRNA partially rescued ethanol-induced gene expression, epiboly and gastrulation defects. Additional studies of this ethanol dysregulated network may identify therapeutic targets that coordinately regulate early development.