Wnts comprise a family of 20 lipid-modified glycoproteins in mammals and play critical roles during embryological development and organogenesis of several organ systems, including the heart. They are required for mesoderm formation and have been implicated in promoting cardiomyogenic differentiation of mammalian embryonic stem cells, but the underlying mechanisms regulating Wnt signaling during cardiomyogenesis remain poorly understood. In this report, we show that in a pluripotent mouse embryonal carcinoma stem cell line, SFRP2 inhibits cardiomyogenic differentiation by regulating Wnt3a transcription. SFRP2 inhibited early stages of cardiomyogenesis, preventing mesoderm specification and maintaining the cells in the undifferentiated state. Using a gain- and loss-of-function approach, we demonstrate that although addition of recombinant SFRP2 decreased Wnt3a transcription and cardiomyogenic differentiation, silencing of Sfrp2 led to enhanced Wnt3a transcription, mesoderm formation, and increased cardiomyogenesis. We show that the inhibitory effects of SFRP2 on Wnt transcription are secondary to interruption of a positive feedback effect of Wnt3a on its own transcription. Wnt3a increased its own transcription via the canonical pathway and TCF4 family of transcription factors, and the inhibitory effects of SFRP2 on Wnt3a transcription were associated with disruption of downstream canonical Wnt signaling. The inhibitory effects of Sfrp2 on Wnt3a expression identify Sfrp2 as a "checkpoint gene," which exerts its control on cardiomyogenesis through regulation of Wnt3a transcription.