Growth and Differentiation Factor 1 (GDF-1) has been implicated in left-right patterning of the mouse embryo but has no other known function. Here, we demonstrate a genetic interaction between Gdf1 and Nodal during anterior axis development. Gdf1-/-;Nodal+/- mutants displayed several abnormalities that were not present in either Gdf1-/- or Nodal+/- single mutants, including absence of notochord and prechordal plate, and malformation of the foregut; organizing centers implicated in the development of the anterior head and branchial arches, respectively. Consistent with these deficits, Gdf1-/-;Nodal+/- mutant embryos displayed a number of axial midline abnormalities, including holoprosencephaly, anterior head truncation, cleft lip, fused nasal cavity, and lack of jaws and tongue. The absence of these defects in single mutants indicated a synergistic interaction between Nodal and GDF-1 in the node, from which the axial mesendoderm that gives rise to the notochord, prechordal plate, and foregut endoderm originates, and where the two factors are co-expressed. This notion was supported by a severe downregulation of FoxA2 and goosecoid in the anterior primitive streak of double mutant embryos. Unlike that in the lateral plate mesoderm, Nodal expression in the node was independent of GDF-1, indicating that both factors act in parallel to control the development of mesendodermal precursors. Receptor reconstitution experiments indicated that GDF-1, like Nodal, can signal through the type I receptors ALK4 and ALK7. However, analysis of compound mutants indicated that ALK4, but not ALK7, was responsible for the effects of GDF-1 and Nodal during anterior axis development. These results indicate that GDF-1 and Nodal converge on ALK4 in the anterior primitive streak to control the formation of organizing centers that are necessary for normal forebrain and branchial arch development.