Congenital diaphragmatic hernia (CDH) is an often fatal birth defect that is commonly associated with pulmonary hypoplasia and cardiac malformations. Some investigators hypothesize that this constellation of defects results from genetic or environmental triggers that disrupt mesenchymal cell function in not only the primordial diaphragm but also the thoracic organs. The alternative hypothesis is that the displacement of the abdominal viscera in the chest secondarily perturbs the development of the heart and lungs. Recently, loss-of-function mutations in the gene encoding FOG-2, a transcriptional co-regulator, have been linked to CDH and pulmonary hypoplasia in humans and mice. Here we show that mutagenesis of the gene for GATA-4, a transcription factor known to functionally interact with FOG-2, predisposes inbred mice to a similar set of birth defects. Analysis of wild-type mouse embryos demonstrated co-expression of Gata4 and Fog2 in mesenchymal cells of the developing diaphragm, lungs, and heart. A significant fraction of C57Bl/6 mice heterozygous for a Gata4 deletion mutation died within 1 day of birth. Developmental defects in the heterozygotes included midline diaphragmatic hernias, dilated distal airways, and cardiac malformations. Heterozygotes had any combination of these defects or none. In chimeric mice, Gata4^−/− cells retained the capacity to contribute to cells in the diaphragmatic central tendon and lung mesenchyme, indicating that GATA-4 is not required for differentiation of these lineages. We conclude that GATA-4, like its co-regulator FOG-2, is required for proper mesenchymal cell function in the developing diaphragm, lungs, and heart.