The mouse develops five pairs of mammary glands that arise during mid-gestation from five pairs of placodes of ectodermal origin. We have investigated the molecular mechanisms of mammary placode development using Lef1 as a marker for the epithelial component of the placode, and mice deficient for Fgf10 or Fgfr2b, both of which fail to develop normal mammary glands. Mammary placode induction involves two different signaling pathways, a FGF10/FGFR2b-dependent pathway for placodes 1, 2, 3 and 5 and a FGF10/FGFR2b-independent pathway for placode 4. Our results also suggest that FGF signaling is involved in the maintenance of mammary bud 4, and that Fgf10 deficient epithelium can undergo branching morphogenesis into the mammary fat pad precursor.