During early vertebrate embryogenesis, gradients of the TGFβ-related factor Nodal control embryonic pluripotency and establish the body plan. But how do embryonic cells interpret subtle changes in Nodal signalling? According to Stefano Piccolo and colleagues, the negative intracellular Smad regulator ectodermin (Ecto) determines how mouse embryonic cells read Nodal signals in vivo (see p. 2571). Recent results suggest that the ubiquitin ligase ectodermin acts as an intracellular regulator of TGFβ signalling by monoubiquitylating Smad4, which causes the disassembly of the R-Smad/Smad4 transcriptional complex that mediates TGFβ signalling. Here, the researchers show that ablation of Ecto in trophoblast cells disrupts the balance between stem cell self-renewal and differentiation by increasing their Nodal responsiveness, a result that reveals a new role for Nodal signalling in trophoblast development. In the epiblast, they report, Ecto deficiency shifts mesoderm fates towards node/organiser fates. These and other results suggest that the negative control of Smad activity by ectodermin orchestrates early mouse development by `tuning' the responses of extra-embryonic and embryonic cells to Nodal.