Limb regeneration in amphibians relies on a specialized wound tissue known as the apical-epithelial-cap (AEC). The AEC forms at amputation sites and is proposed to be analogous to the apical-ectodermal-ridge (AER) - a transient embryonic structure that is essential for limb patterning and outgrowth. However, why and how an AEC forms in some species but not others, and whether this correlates with the ability to regenerate, is unclear. Here, Can Aztekin and colleagues investigate this issue. They use Xenopus laevis tadpoles, which are able to regenerate their limbs but lose this regenerative capacity during development, coinciding with the inability to form an AEC. The researchers first generate a single-cell transcriptomic atlas of intact and amputated limbs from regeneration-competent and -incompetent tadpoles. Analysis of this atlas reveals that successful regeneration is associated with the formation of a signalling centre comprising AER-like cells. Using ex vivo culture of regenerating limbs, they further show that these cells arise from basal epidermal cells, without the need for cell division, in response to multiple signalling pathways. By contrast, they show that inhibitory factors, such as the BMP antagonist NOGGIN, which is known to be secreted by developing cartilage/bone cells, block AER cell formation in regeneration-incompetent tadpoles. Together, these findings suggest that factors secreted from cartilage/bone at later stages of tadpole development inhibit the formation of an AEC and thereby compromise regenerative competency.