We identified four insertional alleles of foxi one (foo), an embryonic lethal mutation in zebrafish that displays defects in both otic placode and the jaw. In foo/foo embryos the otic placode is split into two smaller placodes and mutant embryos show a dorsoventral (DV) cartilage defect manifested as a reduced hyomandibular and reduced third and fourth branchial arches. We identified foxi one (foo), the zebrafish ortholog of Foxi1 (FREAC6, FKHL10, HFH-3, Fkh10) and a member of the forkhead domain transcriptional regulator family, as the gene mutated in foo/foo embryos. foo is expressed in otic placode precursor cells, and foo/foo embryos lack placodal pax8 expression and have disorganized otic expression of pax2.1 and dlx3. Third stream neural crest cell migration, detected by dlx2 and krox20 expression, is aberrant in that it invades the otic placode territory. foo is expressed in pharyngeal pouch endoderm and is required for pouch expression of pax8 and proper patterning of other markers in the pouch such as nkx2.3. In foo/foo embryos, we observed a failure to maintain fgf3 expression in the pouches, followed by apoptosis of neural crest cells in adjacent arches. We conclude that foo expression is essential for pax8 expression probably downstream of Fgf signaling in a conserved pathway jointly required for integrity of patterning in the otic placode and pharyngeal pouches. We propose that correct placement of survival/proliferation cues is essential for shaping the pharyngeal cartilages and that evolutionary links between jaw and ear formation can be traced to Fgf-Foxi1-Pax8 pathways.