Studies of pattern formation in the vertebrate central nervous system indicate that anteroposterior positional information is generated in the embryo by signalling gradients of an as yet unknown nature. We searched for transcription factors that transduce this information to the Hox genes. Based on the assumption that the activity levels of such factors might vary with position along the anteroposterior axis, we devised an in vivo assay to detect responsiveness of cis-acting sequences to such differentially active factors. We used this assay to analyze a Hoxb8 regulatory element, and detected the most pronounced response in a short stretch of DNA containing a cluster of potential CDX binding sites. We show that differentially expressed DNA binding proteins are present in gastrulating embryos that bind to these sites in vitro, that cdx gene products are among these, and that binding site mutations that abolish binding of these proteins completely destroy the ability of the regulatory element to drive regionally restricted expression in the embryo. Finally, we show that ectopic expression of cdx gene products anteriorizes expression of reporter transgenes driven by this regulatory element, as well as that of the endogenous Hoxb8 gene, in a manner that is consistent with them being essential transducers of positional information. These data suggest that, in contrast to Drosophila Caudal, vertebrate cdx gene products transduce positional information directly to the Hox genes, acting through CDX binding sites in their enhancers. This may represent the ancestral mode of action of caudal homologues, which are involved in anteroposterior patterning in organisms with widely divergent body plans and modes of development.