Shaggy is a downstream component of the wingless and Notch signaling pathways which operate during Drosophila development. To address the role of glycogen synthase kinase 3 beta (GSK3 beta), a mammalian homologue of Shaggy, in vertebrate embryogenesis, it was overexpressed in Xenopus embryos. Microinjection of rat GSK3 beta mRNA into animal ventral blastomeres of 8-cell-stage embryos triggered development of ectopic cement glands with an adjacent anterior neural tissue as evidenced by in situ hybridization with Xotx2, a fore/midbrain marker, and NCAM, a pan-neural marker. In contrast, animal dorsal injection of the same dose of GSK3 beta mRNA caused eye deficiencies, whereas vegetal injections had no pronounced effects on normal development. Using several mutated forms of rat GSK3 beta, we demonstrate that the observed phenotypes are dose-dependent and tightly correlate with GSK3 beta enzymatic activity. Lineage tracing experiments showed that the effects of GSK3 beta are cell autonomous and that ectopic cement glands and eye deficiencies arose directly from cells containing GSK3 beta mRNA. Molecular marker analysis of ectodermal explants overexpressing GSK3 beta has revealed activation of Xotx2 and of cement gland marker XAG-1, but expression of NCAM and XIF-3 was not detected. Phenotypic effects of mRNA encoding a Xenopus homologue of GSK3 beta were identical to those of rat GSK3 beta mRNA. We hypothesize that GSK3 beta mediates the initial steps of neural tissue specification and modulates anteroposterior ectodermal patterning via activation of Otx2 transcription. Our observations implicate GSK3 beta in signaling pathways operating during neural tissue development and during specification of anterior ectodermal cell fates.