Abstract During embryonic development, 2 populations of multipotent stem cells, cranial neural crest cells (NCCs) and epibranchial placode cells (PCs), are anatomically adjacent to each other. The coordinated migration of NCCs and PCs plays a major role in the morphogenesis of craniofacial skeletons and cranial nerves. It is known that ethanol-induced dysfunction of NCCs and PCs is a key contributor to the defects of craniofacial skeletons and cranial nerves implicated in fetal alcohol spectrum disorder (FASD). However, how ethanol disrupts the coordinated interaction between NCCs and PCs was not elucidated. To fill in this gap, we established a well-designed cell coculture system to investigate the reciprocal interaction between human NCCs (hNCCs) and human PCs (hPCs), and also monitored the migration behavior of NCCs and PCs in zebrafish embryos. We found that ethanol exposure resulted in a disruption of coordinated hNCCs-hPCs interaction, as well as in zebrafish embryos. Treating hNCCs-hPCs with exosomes derived from ethanol-exposed hNCCs (ExoEtOH) mimicked ethanol-induced impairment of hNCCs-hPCs interaction. We also observed that SDF1, a chemoattractant, was downregulated in ethanol-treated hPCs and zebrafish embryos. Meanwhile, miR-126 level in ExoEtOH was significantly higher than that in control exosomes (ExoCon). We further validated that ExoEtOH-encapsulated miR-126 from hNCCs can be transferred to hPCs to suppress SDF1 expression in hPCs. Knockdown of SDF1 replicated ethanol-induced abnormalities either in vitro or in zebrafish embryos. On the contrary, overexpression of SDF1 or inhibiting miR-126 strongly rescued ethanol-induced impairment of hNCCs-hPCs interaction and developmental defects.