The Rel/NF-kappa B gene family encodes a large group of transcriptional activators involved in myriad differentiation events, including embryonic development. We have shown previously that Xrel3, a Xenopus Rel/NF-kappa B-related gene, is expressed in the forebrain, dorsal aspect of the mid- and hindbrain, the otocysts and notochord of neurula and larval stage embryos. Overexpression of Xrel3 causes formation of embryonic tumours. We now show that Xrel3-induced tumours and animal caps from embryos injected with Xrel3 RNA express Otx2, Shh and Gli1. Heterodimerisation of a C-terminally deleted mutant of Xrel3 with wild-type Xrel3 inhibits in vitro binding of wild-type Xrel3 to Rel/NF-kappa B consensus DNA sequences. This dominant interference mutant disrupts Shh, Gli1 and Otx2 mRNA patterning and inhibits anterior development when expressed in the dorsal side of zygotes, which is rescued by co-injecting wild-type Xrel3 mRNA. In chick development, Rel activates Shh signalling, which is required for normal limb formation; Shh, Gli1 and Otx2 encode important neural patterning elements in vertebrates. The activation of these genes in tumours by Xrel3 overexpression and the inhibition of their expression and head development by a dominant interference mutant of Xrel3 indicates that Rel/NF-kappa B is required for activation of these genes and for anterior neural patterning in Xenopus.

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