In zebrafish embryos, the nascent embryonic shield first appears as a thickening in the germ ring of the mid-epiboly blastoderm. This site defines the dorsal side of the developing embryo. In this paper, we report that the site of embryonic axis formation is marked earlier at the late-blastula stage by the appearance of a cluster of cells with unique endocytic activities. This cluster of cells is composed of enveloping layer epithelial cells and one to two layers of underlying deep cells. Unlike other marginal blastomeres, cells in this cluster do not participate in involution as the blastoderm undergoes epiboly. These noninvoluting endocytic marginal (NEM) cells can be selectively labeled by applying membrane impermeant fluorescent probes to pre-epiboly and mid-epiboly embryos. During embryonic shield formation, deep cells in the NEM cell cluster rearrange and are displaced forward to the leading edge of the blastoderm. As deep NEM cells move into this location, they become a group of cells known as "forerunner cells." Between 60%- and 80%-epiboly, the forerunner cells coalesce into a coherent cell cluster that forms a wedge-shaped cap at the leading edge of the blastoderm. During embryonic axis formation, deep cells migrate and converge toward the embryonic midline, which is defined by the center of the forerunner cell cluster. At approximately 90% epiboly, the forerunner cell cluster becomes overlapped by the constricting germ ring. At tailbud stage, forerunner cells form the dorsal roof of Kupffer's vesicle, which is located ventral to the nascent chordoneural hinge. On the basis of previous grafting studies and known dorsal gene expression patterns, we discuss possible roles that the NEM/forerunner cell cluster may play in teleost axis formation.