Dapper1 and Dapper2, two divergent members of the Dapper family, have been suggested to modulate Wnt and TGF-beta/Nodal signaling in Xenopus and zebrafish. To get a better understanding of Dapper function in mammals, we have cloned the mouse ortholog of zebrafish Dapper2, mDpr2 and investigated its function in regulating TGF-beta signaling activity. Here, we showed that, like zebrafish Dapper2, overexpression of mDpr2 inhibited the TGF-beta-induced expression of the Smad-responsive reporters and targeted TGF-beta type I receptor ALK5 for degradation in mammalian cells. Overexpression of mDpr2 in the zebrafish embryos led to a decrease in expression of the mesoderm marker no tail and goosecoid at the shield stage and eye fusion later, implying that mDpr2 may have an intrinsic in vivo activity similar to fish Dapper2 activity. The expression of mDpr2 was detected throughout the epiblast around the onset of gastrulation and in somites, the neural tube and gut at later stages in mouse embryos, implying a role in early embryonic development. Our data indicate that the function of Dpr2 as a negative regulator of the TGF-beta/Nodal signal pathway is evolutionally conserved, at least in part, in fish and mammals.