In the process of cloning murine proteins capable of binding to a regulatory module of the Ncam promoter, we isolated a novel homeobox gene, Barx1, the first vertebrate member of the structural subclass defined by Drosophila BarH1. Here we report its sequence, chromosomal localisation and embryonic expression pattern. Barx1 was strongly expressed in restricted areas of head and neck mesenchyme and in the wall of the developing stomach and at weaker levels in the proximal fore- and hindlimbs. At embryonic day 10.5, expression in the head region is detected in spatially restricted areas of the first and second branchial arches, before any apparent cellular or morphological differentiation. Later in development, all expressing tissues in this region, which include the mesenchyme underlying the olfactory epithelium, the primary and secondary palate, the molar tooth papillae and the stroma of the submandibular gland, appear derived from ectomesenchyme of neural crest origin. At day 16.5, all locations other than the developing molars had become Barx1-negative. An intriguing feature is the restriction of Barx1 expression to the molars suggesting a role in the differentiation of molars from incisors. Barx1 already marks the future stomach region of the primitive gut at embryonic day 9.5 and is present in the mesenchymal wall of the stomach up to day 16.5. These results thus direct a search for its function to a number of inductive epithelial-mesenchymal interactions during craniofacial development and to stomach organogenesis.