Here we characterize the consequences of elevated bone morphogenetic protein (BMP) signaling on neural tube morphogenesis by analyzing mice lacking the BMP antagonist, Noggin. Noggin is expressed dorsally in the closing neural folds and ventrally in the notochord and somites. All Noggin-/- pups are born with lumbar spina bifida; depending on genetic background, they may also have exencephaly. The exencephaly is due to a primary failure of neurulation, resulting from a lack of mid/hindbrain dorsolateral hinge point (DLHP) formation. Thus, as previously shown for Shh signaling at spinal levels, BMP activity may inhibit cranial DLHP morphogenesis. However, the increased BMP signaling observed in the Noggin-/- dorsal neural tube is not sufficient to cause exencephaly; it appears to also depend on the action of a genetic modifier, which may act to increase dorsal Shh signaling. The spinal neural tube defect results from a different mechanism: increased BMP signaling in the mesoderm between the limb buds leads to abnormal somite differentiation and axial skeletal malformation. The resulting lack of mechanical support for the neural tube causes spina bifida. We show that this defect is due to elevated BMP4 signaling. Thus, Noggin is required for mammalian neurulation in two contexts, dependent on position along the rostrocaudal axis.