Mutations in the homeobox transcription factor MNX1 are the major cause of dominantly inherited sacral agenesis. Studies in model organisms revealed conserved mnx gene requirements in neuronal and pancreatic development while Mnx activities that could explain the caudal mesoderm specific agenesis phenotype remain elusive. Here we use the zebrafish pronephros as a simple yet genetically conserved model for kidney formation to uncover a novel role of Mnx factors in nephron morphogenesis. Pronephros formation can formally be divided in four stages, the specification of nephric mesoderm from the intermediate mesoderm (IM), growth and epithelialisation, segmentation and formation of the glomerular capillary tuft. Two of the three mnx genes in zebrafish are dynamically transcribed in caudal IM in a time window that proceeds segmentation. We show that expression of one mnx gene, mnx2b, is restricted to the pronephric lineage and that mnx2b knock-down causes proximal pronephric tubule dilation and impaired pronephric excretion. Using expression profiling of embryos transgenic for conditional activation and repression of Mnx regulated genes, we further identified irx1b as a direct target of Mnx factors. Consistent with a repression of irx1b by Mnx factors, the transcripts of irx1b and mnx genes are found in mutual exclusive regions in the IM, and blocking of Mnx functions results in a caudal expansion of the IM-specific irx1b expression. Finally, we find that knock-down of irx1b is sufficient to rescue proximal pronephric tubule dilation and impaired nephron function in mnx-morpholino injected embryos. Our data revealed a first caudal mesoderm specific requirement of Mnx factors in a non-human system and they demonstrate that Mnx-dependent restriction of IM-specific irx1b activation is required for the morphogenesis and function of the zebrafish pronephros.