Specification of the dorsoventral (DV) axis is critical for the subsequent differentiation of regional fate in the primary germ layers of the vertebrate embryo. We have identified a novel factor that is essential for dorsal development in embryos of the frog Xenopus laevis. Misexpression of Xenopus mab21-like 3 (Xmab21l3) dorsalizes gastrula-stage mesoderm and neurula-stage ectoderm, while morpholino-mediated knockdown of Xmab21l3 inhibits dorsal differentiation of these embryonic germ layers. Xmab21l3 is a member of a chordate-specific subclass of a recently characterized gene family, all members of which contain a conserved, but as yet ill-defined, Mab21 domain. Our studies suggest that Xmab21l3 functions to repress ventralizing activity in the early vertebrate embryo, via regulation of BMP/Smad and Ras/ERK signaling.