The transforming growth factor beta superfamily member, activin, is able to induce mesodermal tissues in animal cap explants from Xenopus laevis blastula stage embryos. Activin can act like a morphogen of the dorsoventral axis in that lower doses induce more ventral, and higher doses more dorsal, tissue types. Activin has also previously been reported to induce neural tissues in animal caps. From cell mixing experiments it was inferred that this might be an indirect effect of induced mesoderm signaling to uninduced ectoderm. Here we demonstrate directly that neural tissues do indeed arise by the action of induced mesoderm on uninduced ectoderm. Dorsal mesoderm is itself subdivided into posterior and anterior domains in vivo, but this had not been demonstrated for induced mesoderm. We therefore tested whether different concentrations of activin recreate these different anteroposterior properties as well. We show that the anteroposterior positional value of induced mesoderm, including its neuroinductive properties, depends on the dose of activin applied to the mesoderm, with lower doses inducing more posterior and higher doses giving more anterior markers. We discuss the implications of these results for patterning signals and the relationship between anteroposterior and dorsoventral axes.