In the early Xenopus embryo, a quadrant of endodermal cells that have descended from the vegetal dorsal localization in the zygote produces signals that pass into the animal hemisphere and induce dorsal mesoderm from the marginal zone. From the remaining three quadrants of the bordering endoderm, signals pass into the animal hemisphere and induce ventral mesoderm in the marginal region. There is evidence that suggests that these same mesoderm-inducing signals continue through the plane of the tissue of the animal hemisphere where they may at least begin the processes of neural and epidermal induction by changing the competence of the prospective ectodermal cells, and possibly influencing the early regional biasing of later expression of at least some gene products, such as Epi-1 whose expression in the future epidermal domain seems specified before gastrulation. We hypothesized that the interaction of the ventral and dorsal signals within the plane of the tissue of the animal hemisphere may position the border of the neural plate. If this is so, then transplantation into the animal pole of cells that signal induction of ventral mesoderm should drive the neural plate boundary back toward the blastopore and shorten the anterior-posterior axis. Removal of cells that induce ventral mesoderm should result in an axis that is longer than normal. Results of our experiments support these predictions. Also, by late pregastrula stage 9, increasing the ventral signals has no effect. Thus the evidence suggests that the position of the anterior neural plate boundary is established before gastrulation begins by the interaction of the signals that induce the ventral and dorsal mesoderm.