Convergent extension behaviour is critical for the formation of the vertebrate body axis. In Xenopus, components of the Wnt signaling pathway have been shown to be required for convergent extension movements but the relationship between cell fate and morphogenesis is little understood. We show by loss of function analysis that Xnr3 activates Xbra expression through FGFR1. We show that eFGF activity is not essential in the pathway, and that dishevelled acts downstream of Xnr3 and not in a parallel pathway. We provide evidence for the involvement of the EGF-CFC protein FRL1, and suggest that the pro-domain of Xnr3 may be required for its activity. Since Xnr3 is a direct target of the maternal βcatenin/XTcf3 signaling pathway, it provides the link between the initial, maternally controlled, allocation of cell fate, and the morphogenetic movements of cells derived from the organizer.