Tcf/Lef HMG box transcription factors are nuclear effectors of the canonical Wnt signaling pathway, which function in cell fate specification. Lef1 is required for the development of tissues and organs that depend on epithelial mesenchymal interactions. Here, we report the effects of lef1 loss of function on early development in X. tropicalis. Depletion of lef1 affects gene expression already during gastrulation and results in abnormal differentiation of cells derived from ectoderm and mesoderm. At tail bud stages, the epidermis was devoid of ciliated cells and derivatives of the neural crest, e.g. melanocytes and cephalic ganglia were absent. In the Central Nervous System, nerve fibers were absent or underdeveloped. The development of the paraxial mesoderm was affected; intersomitic boundaries were not distinct and development of the hypaxial musculature was impaired. The development of the pronephros and pronephric ducts was disturbed. Most striking was the absence of blood flow in lef1 depleted embryos. Analysis of blood vessel marker genes demonstrated that lef1 is required for the development of the major blood vessels and the heart.