DLK1/FA1 (delta like-1 homolog/Fetal Antigen-1) is a novel surface marker for embryonic chondroprogenitor cells undergoing lineage progression from proliferation to prehypertrophic stages. However, mechanisms mediating control of its expression during chondrogenesis are not known. Thus, we examined the effect of a number of signalling molecules on DLK1 expression during in vitro chondrogenic differentiation in mouse embryonic limb bud mesenchymal micromass cultures and mouse embryonic fibroblast (MEF) pellet cultures. Dlk1 was initially expressed during mesenchymal condensation and chondrocyte proliferation, in parallel with expression of Sox9 and Col2a1, and was down-regulated upon expression of Col10a1 by hypertrophic chondrocytes. Among a number of molecules that affected chondrogenesis, TGF-b signalling regulated Dlk1expression. TGF-b1-induced chondrogenesis was associated with decreased Dlk1 expression and these effects were abolished by the TGF-b signalling inhibitor SB4311542 suggesting an involvement of DLK1/FA1 in mediating the function of TGF-b1 signalling in chondrogenesis. In support of this hypothesis, we found that TGF-b1 enhanced chondrocyte differentiation in dlk1-/- MEF compared to wild type MEF. In conclusion, our data identified TGF-b-1 as an upstream negative regulator of Dlk1 expression and function during the early events of embryonic chondrogenesis. The cross-talk between TGF-b1 and DLK1 showed promotion of early chondrogenesis during embryonic endochondral bone formation process.