All eukaryotic cells contain the phospholipid phosphatidylinositol 4, 5-bisphosphate (PIP₂) that serves multiple roles in signal transduction cascades. Type I phosphatidylinositol-4-phosphate 5-kinase (PIP5KI) catalyzes the synthesis of PIP₂ by phosphorylating phosphatidylinositol 4 phosphate. Although the classical isoforms of PIP5KI (designated as α, β, and γ) all generate the same phospholipid product, they have significantly dissimilar primary structures and expression levels in different tissues, and they appear to localize within different compartments within the cell. Therefore, it appears likely that PIP5KI isoforms have overlapping, but not identical, functions. Here we show that targeted disruption of PIP5KIγ causes widespread developmental and cellular defects. PIP5KIγ-null embryos have myocardial developmental defects associated with impaired intracellular junctions that lead to heart failure and extensive prenatal lethality at embryonic day 11.5 of development. Loss of PIP5KIγ also results in neural tube closure defects that were associated with impaired PIP₂ production, adhesion junction formation, and neuronal cell migration. These data, along with those of other PIP5KI isoforms, indicate that individual PIP5KI isoenzymes fulfill specific roles in embryonic development.