Background: The neural crest (NC) is a multipotent embryonic cell population, which is induced by an integration of secreted signals including BMP, Wnt, and FGF and, subsequently, NC cell fates are specified by a regulatory network of specific transcription factors. This study was undertaken to identify a role of Sp5 transcription factor in vertebrates. Results: Xenopus Sp5 is expressed in the prospective neural crest regions from gastrulation through the tadpole stages in early development. Knockdown of Sp5 caused severe defects in craniofacial cartilage, pigmentation, and dorsal fin. Gain- and loss-of-function of Sp5 led to up- and down-regulation of the expression of NC markers in the neural fold, respectively. In contrast, Sp5 had no effect on neural induction and patterning. Sp5 regulated the expression of neural plate border (NPB) specifiers, Msx1 and Pax3, and these regulatory factors recovered the expression of NC marker in the Sp5-deficient embryos. Depletion of Sp5 impaired NC induction by Wnt/β-catenin or FGF signal, whereas its co-expression rescued NC markers in embryos in which either signal was blocked. Conclusions: These results suggest that Sp5 functions as a critical early factor in the genetic cascade to regulate NC induction downstream of Wnt and FGF pathways. Developmental Dynamics 242:1382–1394, 2013. © 2013 Wiley Periodicals, Inc.