The mouse homeobox-genes Msx-1 and Msx-2 are expressed in several areas of the developing embryo, including the neural tube, neural crest, facial processes and limb buds. Here we report the characterisation of a third mouse Msx gene, which we designate Msx-3. The embryonic expression of Msx-3 was found to differ from that of Msx-1 and -2 in that it was confined to the dorsal neural tube. In embryos with 5-8 somites a segmental pattern of expression was observed in the hindbrain, with rhombomeres 3 and 5 lacking Msx-3 while other rhombomeres expressed Msx-3. This pattern was transient, however, such that in embryos with 18 or more somites expression was continuous throughout the dorsal hindbrain and anterior dorsal spinal cord. Differentiation of dorsal cell types in the neural tube can be induced by addition of members of the Tgf-beta family. Additionally, Msx-1 and -2 have been shown to be activated by addition of the Tgf-beta family member Bmp-4. To determine if Bmp-4 could activate Msx-3, we incubated embryonic hindbrain explants with exogenous Bmp-4. The dorsal expression of Msx-3 was seen to expand into more ventral regions of the neurectoderm in Bmp-4-treated cultures, implying that Bmp-4 may be able to mimic an in vivo signal that induces Msx-3.