Vertebrate segmentation is regulated by the "segmentation clock", which drives cyclic expression of several genes in the caudal presomitic mesoderm (PSM). One such gene is Lunatic fringe (Lfng), which encodes a modifier of Notch signalling, and which is also expressed in a stripe at the cranial end of the PSM, adjacent to the newly forming somite border. We have investigated the functional requirements for these modes of Lfng expression during somitogenesis by generating mice in which Lfng is expressed in the cranial stripe but strongly reduced in the caudal PSM, and find that requirements for Lfng activity alter during axial growth. Formation of cervical, thoracic and lumbar somites/vertebrae, but not sacral and adjacent tail somites/vertebrae, depends on caudal, cyclic Lfng expression. Indeed, the sacral region segments normally in the complete absence of Lfng and shows a reduced requirement for another oscillating gene, Hes7, indicating that the architecture of the clock alters as segmentation progresses. We present evidence that Lfng controls dorsal-ventral axis specification in the tail, and also suggest that Lfng controls the expression or activity of a long-range signal that regulates axial extension.