AbstractWnt/β-catenin signalling has been shown to play a critical role during head organizer formation in Hydra. Here, we characterized the Wnt signalling regulatory network involved in formation of the head organizer. We found that Wnt signalling regulates genes that are important in tissue morphogenesis. We identified that majority of transcription factors (TFs) regulated by Wnt/β-catenin signalling belong to the homeodomain and forkhead families. Silencing of Margin, one of the Wnt regulated homeodomain TFs, results in loss of the ectopic tentacle phenotype typically seen upon activation of Wnt signalling. Furthermore, we show that the Margin promoter is directly bound and regulated by β-catenin. Ectopic expression of Margin in zebrafish embryos results in body axis abnormalities suggesting that Margin plays a role in axis patterning. Our findings suggest that homeobox TFs came under the regulatory umbrella of Wnt/β-catenin signalling presumably resulting in the evolution of primary body axis in animal phyla.