Mutations in the transcription factor gene SOX18 cause vascular, lymphatic and hair follicle defects in humans with dominant and recessive forms of hypotrichosis-lymphedema-telangiectasia (HLT) syndrome. Here, we clarify the role of SOX18 in the vascular dysfunction in HLT by ultrastructural, immunofluorescence, molecular and functional analysis of vascular anomalies in embryos of the naturally occurring Sox18-mutant mouse strain ragged-opossum (Ra(Op)). Early genesis and patterning of vasculature was unimpaired in Ra(Op) embryos, but surface capillaries became enlarged from 12.5 dpc and embryos developed massive surface hemorrhage by 14.5 dpc. Large focal breaches in the endothelial barrier were observed, in addition to endothelial hyperplasia associated with impaired pericyte recruitment to the microvasculature. Expression of the genes encoding the endothelial factors MMP7, IL7R and N-cadherin was reduced in Ra(Op) embryos, suggesting that these are downstream targets of SOX18. Together, our results indicate that vascular anomalies in HLT arise from defects in regulation of genes required for the acquisition of structural integrity during microvascular maturation.