Formation of the cardiac valves is an essential component of cardiovascular development. Consistent with the role of the bone morphogenetic protein (BMP) signaling pathway in cardiac valve formation, embryos that are deficient for the BMP regulator BMPER (BMP-binding endothelial regulator) display the cardiac valve anomaly mitral valve prolapse. However, how BMPER deficiency leads to this defect is unknown. Based on its expression pattern in the developing cardiac cushions, we hypothesized that BMPER regulates BMP2-mediated signaling, leading to fine-tuned epithelial-mesenchymal transition (EMT) and extracellular matrix deposition. In the BMPER-/- embryo, EMT is dysregulated in the atrioventricular and outflow tract cushions compared with their wild-type counterparts, as indicated by a significant increase of Sox9-positive cells during cushion formation. However, proliferation is not impaired in the developing BMPER-/- valves. In vitro data show that BMPER directly binds BMP2. In cultured endothelial cells, BMPER blocks BMP2-induced Smad activation in a dose-dependent manner. In addition, BMP2 increases the Sox9 protein level, and this increase is inhibited by co-treatment with BMPER. Consistently, in the BMPER-/- embryos, semi-quantitative analysis of Smad activation shows that the canonical BMP pathway is significantly more active in the atrioventricular cushions during EMT. These results indicate that BMPER negatively regulates BMP-induced Smad and Sox9 activity during valve development. Together, these results identify BMPER as a regulator of BMP2-induced cardiac valve development and will contribute to our understanding of valvular defects.