Loss of Twist gene function arrests the growth of the limb bud shortly after its formation. In the Twist(-/-) forelimb bud, Fgf10 expression is reduced, Fgf4 is not expressed, and the domain of Fgf8 and Fgfr2 expression is altered. This is accompanied by disruption of the expression of genes (Shh, Gli1, Gli2, Gli3, and Ptch) associated with SHH signalling in the limb bud mesenchyme, the down-regulation of Bmp4 in the apical ectoderm, the absence of Alx3, Alx4, Pax1, and Pax3 activity in the mesenchyme, and a reduced potency of the limb bud tissues to differentiate into osteogenic and myogenic tissues. Development of the hindlimb buds in Twist(-/-) embryos is also retarded. The overall activity of genes involved in SHH signalling is reduced.Fgf4 and Fgf8 expression is lost or reduced in the apical ectoderm, but other genes (Fgf10, Fgfr2) involved with FGF signalling are expressed in normal patterns. Twist(+/-);Gli3(+/XtJ) mice display more severe polydactyly than that seen in either Twist(+/-) or Gli3(+/XtJ) mice, suggesting that there is genetic interaction between Twist and Gli3 activity. Twist activity is therefore essential for the growth and differentiation of the limb bud tissues as well as regulation of tissue patterning via the modulation of SHH and FGF signal transduction.