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Members of the Bmp family ily of TGF-? signals induce ventral fates and play pivotal roles in proper dorsoventral patterning of vertebrate embryos.Ppp4c is the catalytic subunit of ubiquitous protein phosphatase 4(Ppp4);however,its role in development of vertebrate embryos and underlying mechanisms are largely unknown.We demonstrate that Ppp4c is required for ventral development during early zebrafish embryogenesis.Knockdown of ppp4cb or/and ppp4ca,two zebrafish ppp4c genes,inhibits ventral development and this effect is rescued by coinjection of ppp4cb mRNA.Biochemical analyses reveal that Ppp4c is a direct binding partner and transcriptional activity enhancer of Smad1/5,two key signal transducers of the canonical Bmp pathway.Ppp4c is recruited to the Smad1-occupied promoter and its phosphatase activity is essential in derepressing the activity of the corepressor HDAC3 and consequently enhancing the promoter activity in cultured cells.Consistently,ppp4cb knockdown in zebrafish embryos blocks ventralizing activity of ectopic Bmp signals;embryonic dorsalization caused by ppp4cb knockdown is alleviated by attenuation of Hdac activity or hdac3 expression.We conclude that Ppp4c is a critical positive regulator of Bmp signaling and is required for proper embryonic dorsoventral patterning in zebrafish.