The Rybp/DEDAF protein has been implicated in both transcriptional regulation and apoptotic signaling, but its precise molecular function is unclear. To determine the physiological role of Rybp, we analyzed its expression during mouse development and generated mice carrying a targeted deletion of Rybp using homologous recombination in embryonic stem cells. Rybp was found to be broadly expressed during embryogenesis and was particularly abundant in extraembryonic tissues, including trophoblast giant cells. Consistent with this result, rybp homozygous null embryos exhibited lethality at the early postimplantation stage. At this time, Rybp was essential for survival of the embryo, for the establishment of functional extraembryonic structures, and for the execution of full decidualization. Through the use of a chimeric approach, the embryonic lethal phenotype was circumvented and a role for Rybp in central nervous system development was uncovered. Specifically, the presence of Rybp-deficient cells resulted in marked forebrain overgrowth and in localized regions of disrupted neural tube closure. Functions for Rybp in the brain also were supported by the finding of exencephaly in about 15% of rybp heterozygous mutant embryos, and by Rybp's distinct neural expression pattern. Together, these findings support critical roles for Rybp at multiple stages of mouse embryogenesis.