Differentiation of distinct cell types at specific locations within a developing organism depends largely on the ability of cells to communicate. A major class of signalling proteins implicated in cell to cell communication is represented by members of the TGF beta superfamily. A corresponding class of transmembrane serine/threonine kinases has recently been discovered that act as cell surface receptors for ligands of the TGF beta superfamily. The product of the Drosophila gene decapentaplegic (dpp) encodes a TGF beta homolog that plays multiple roles during embryogenesis and the development of imaginal discs. Here we describe the complex expression pattern of thick veins (tkv), which encodes a receptor for dpp. We make use of tkv loss-of-function mutations to examine the consequences of the failure of embryonic cells to respond to dpp and/or other TGF beta homologs. We find that while maternal tkv product allows largely normal dorsoventral pattering of the embryo, zygotic tkv activity is indispensable for dorsal closure of the embryo after germ band retraction. Furthermore, tkv activity is crucial for patterning the visceral mesoderm; in the absence of functional tkv gene product, visceral mesoderm parasegment 7 cells fail to express Ultrabithorax, but instead accumulate Antennapedia protein. The tkv receptor is therefore involved in delimiting the expression domains of homeotic genes in the visceral mesoderm. Interestingly, tkv mutants fail to establish a proper tracheal network. Tracheal braches formed by cells migrating in dorsal or ventral directions are absent in tkv mutants. The requirements for tkv in dorsal closure, visceral mesoderm and trachea development assign novel functions to dpp or a closely related member of the TGF beta superfamily.