Vertebrate animals exhibit segmented axial skeletons and lateral asymmetry of the visceral organs. The segment identity of individual vertebrae is believed to be determined by a combination of functionally active Hox genes that have defined expression boundaries along the anteroposterior axis (known as the axial Hox code). Disturbance of the Hox code by ectopic expression or mutation of Hox genes often leads to homeotic transformation of the vertebrae. Largely unknown, however, are the signaling molecules that provide the positional cues for the precise establishment and maintenance of the Hox code. In this study we show that disruption of the type IIB activin receptor (ActRIIB) by gene targeting results in altered expression of multiple Hox genes and abnormal patterning of the vertebrae, similar to but severer than retinoic acid (RA)-induced anterior transformation. We further show that RA and ActRIIB mutation have synergistic effects on vertebral patterning. Activin, Vg-1 and, type II activin receptors have been implicated in regulation of lateral asymmetry during chick and Xenopus development. We show here that the ActRIIB-/- mice die after birth with complicated cardiac defects including randomized heart position, malposition of the great arteries, and ventricular and atrial septal defects. In addition, the heart anomalies are associated with right pulmonary isomerism and splenic abnormalities, recapitulating the clinical symptoms of the human asplenia syndrome. These findings provide genetic evidence that the ActRIIB-mediated signaling pathway plays a critical role in patterning both anteroposterior and left-right axes in vertebrate animals.