Signaling molecules of the Wnt gene family are involved in the regulation of dorso-ventral, segmental and tissue polarity in Xenopus and Drosophila embryos. Members of the frizzled gene family, such as Drosophila frizzled-2 and rat frizzled-l, have been shown to encode Wnt binding activity and to engage intracellular signal transduction molecules known to be part of the Wnt signaling pathway. Here we describe the cloning and characterization of Fritz, a mouse (mfiz) and human (hfiz) gene which codes for a secreted protein that is structurally related to the extracellular portion of the frizzled genes from Drosophila and vertebrates. The Fritz protein antagonizes Wnt function when both proteins are ectopically expressed in Xenopus embryos. In early gastrulation, mouse fiz mRNA is expressed in all three germ layers. Later in embryogenesis fiz mRNA is found in the central and peripheral nervous systems, nephrogenic mesenchyme and several other tissues, all of which are sites where Wnt proteins have been implicated in tissue patterning. We propose a model in which Fritz can interfere with the activity of Wnt proteins via their cognate frizzled receptors and thereby modulate the biological responses to Wnt activity in a multitude of tissue sites.