Assessing the role of the WT1 transcription factor (WT1) during early gonad differentiation and its impact on adult sex development has been difficult due to the complete gonadal agenesis and embryonic lethality exhibited by Wt1KO mouse models. Here, we generated Wt1LoxP/GFP;Wt1Cre mice, the first Wt1KO mouse model that reaches adulthood with a dramatically reduced Wt1 expression during early gonadogenesis. Wt1LoxP/GFP;Wt1Cre mice lacked mature gonads and displayed genital tracts containing both male and female genital structures and ambiguous genitalia. We found that WT1 is necessary for the activation of both male and female sex-determining pathways, as embryonic mutant gonads failed to upregulate the expression of the genes specific for each genetic programme. The gonads of Wt1LoxP/GFP;Wt1Cre mice showed a lack of production of Sertoli and pre-granulosa cells and a reduced number of germ cells. NR5A1 and the steroidogenic genes expression was modulated differently in XY and XX Wt1LoxP/GFP;Wt1Cre gonads, explaining the mutant phenotypes. Further studies of the XX Wt1LoxP/GFP;Wt1Cre gonads revealed that deletion of WT1 at an early stage impaired the differentiation of several cell types including somatic cells and the ovarian epithelium. Through the characterisation of this Wt1KO mouse model, we show that the deletion of Wt1 during early gonadogenesis produces dramatic defects in adult sex development.