The earliest events underlying cardiac induction and morphogenesis remain largely unknown. In the present study, we show that Hensen's node, the organizer of the avian embryo, induces cardiogenesis. Specifically, following heterotopic transplantation, Hensen's node induces ectopic host tissue that expresses two early cardiac markers ( cNkx-2.5 and cNkx-2.8), as well as a ventricular marker ( VMHC1), but not an atrial marker ( AMHC1). Moreover, we examine the potential roles of candidate growth factors known to be secreted by Hensen's node. Our results show that fibroblast growth factors (FGF-2 and FGF-4) when ectopically expressed can initiate cardiac development, inducing host tissue to express the two cardiac transcription factors cNkx-2.5 and cNkx-2.8, as well as the cardiac-restricted structural gene VMHC1, but not AMHC1. In contrast to FGFs, TGFbeta family members fail to induce ectopic tissue and expression of cardiac marker genes. We also examined the effects of growth factors on the morphogenesis of the host embryo's heart. Both exogenous FGFs and TGFbeta family members perturb normal morphogenesis of the early cardiac tube and alter patterns of ventricular and atria gene expression in characteristic ways. Namely, exogenous FGFs expand areas expressing the ventricular marker VMHC1 at the expense of areas expressing the atrial marker AMHC1. Conversely, exogenous TGFbeta1 inhibits expression of VMHC1, expanding AMHC1 expression. We show here that Hensen's node and FGFs induce ectopic expression of cardiac lineage markers, and that FGF and TGFbeta family members can modulate early development of the heart. Collectively, these data suggest that the organizer plays a crucial role in cardiac induction and morphogenesis, mediated in part by endogenous members of the FGF and TGFbeta families.