In early development of vertebrates, sonic hedgehog functions in dorsal-ventral patterning of dorsal tissue (nervous system and somites). In Xenopus, sonic hedgehog (Xshh) is first expressed in the Spemann organizer/notochord and floor plate. We report here the mechanism governing Xshh mRNA induction in these regions. In animal cap assays, the antagonizing BMPs signal was not sufficient to induce Xshh mRNA expression; however, it could induce Xshh mRNA expression in the presence of Xnr-1. In whole embryos, when secondary axes were induced by coexpressing noggin and Xnr-1 or follistatin and Xnr-1, Xshh mRNA expression was observed in the notochord and floor plate within the induced axes. It seems apparent that spatially restricted Xshh mRNA expression is determined as intersection of the two signals.