To investigate the functions of N-cadherin in vivo, we have mutated the gene encoding this adhesion protein in mice. Although N-cadherin is expressed at the time of gastrulation and neurulation, both neurulation and somitogenesis initiate apparently normally in homozygous mutant embryos. However, the resulting structures are often malformed. The somites of the mutant embryos are small, irregularly shaped, and less cohesive compared with those of their wild-type littermates, and the epithelial organization of the somites is partially disrupted. Undulation of the neural tube is also observed in the mutant embryos. Homozygous mutant embryos die by Day 10 of gestation. The mesodermal and endodermal cell layers of the yolk sac are separated in the mutants. The most dramatic cell adhesion defect is observed in the primitive heart; although myocardial tissue forms initially, the myocytes subsequently dissociate and the heart tube fails to develop normally. In vitro studies of cardiac myocytes derived from N-cadherin mutant embryos show that the cells can loosely aggregate and beat synchronously, demonstrating that electrical coupling can occur between N-cadherin-deficient cardiac myocytes. These results show that N-cadherin plays a critical role in early heart development as well as in other morphogenetic processes.