Intestinal crypts constitute a niche in which epithelial progenitors respond to Wnt signals, replicate, and prepare to differentiate. Because mutations in Wnt pathway genes lead to intestinal cancer, the role of Wnt signaling in gut epithelial homeostasis is a subject of intense investigation. We studied how Wnt signaling is established during intestine development.We studied spatiotemporal features of Wnt signaling at formative stages in mouse embryos, when villous projections appear and crypt precursors occupy intervillus regions. We used TOP-GAL transgenic and Axin2(LacZ) mice, which report faithfully on canonical Wnt activity, relevant molecular markers, and embryos with aberrant beta-catenin activation.Developing intestines first display evidence for Wnt signaling after appearance of villi. During villus morphogenesis, intervillus cells proliferate actively but lack signs of canonical Wnt signaling. Surprisingly, in late gestation and briefly thereafter, conspicuous Wnt activity is evident in differentiated, postmitotic villus epithelium. Neither Tcf4, a principal transcriptional effector of intestinal Wnt signals, nor candidate Wnt targets CD44 and cyclinD1 are expressed in late fetal villus cells that show high Wnt activity. Instead, those cells express the related factor Tcf3 and a different Wnt target, c-Myc. Premature and deregulated beta-catenin activation causes severe villus dysmorphogenesis in transgenic mice.Relationships among Wnt signaling, epithelial proliferation, and tissue differentiation are reversed in the developing and adult gut. The canonical Wnt pathway has independent, albeit possibly overlapping, functions in early intestinal villi and adult crypts. These observations advance understanding of Wnt functions in intestinal development and disease.