In Xenopus, ectodermal cell fates are determined by antagonistic interaction between the BMP subfamily of TGF-β ligands and the organizer-specific secreted factors (e.g. noggin, chordin and follistatin). Inhibition of BMP function by these factors can convert cells from an epidermal to a neural cell fate. In this study, we report that GDF6, a new member of the Xenopus TGF-β family, can function in antagonistic interaction with neural inducers. GDF6 induces epidermis and inhibits neural tissue in dissociated cells, and this activity is blocked by the presence of noggin. We demonstrate that GDF6 binds directly to the neural inducer noggin. Furthermore, we find that GDF6 and BMP2 can form heterodimers and the process seems to require cotranslation of the proteins in the same cells. In normal embryos, GDF6 and BMP2 are coexpressed in several places, including the edge of the neural plate at early neurula stages, suggesting that GDF6 may synergize with BMPs to regulate patterning of the ectoderm. Our data show for the first time that noggin can bind directly to and inhibit another TGF-β family member: GDF6. In addition, BMP and GDF6 heterodimers may play an important role in vivo to regulate cell fate determination and patterning.