We have investigated the mechanisms by which the epithelial apicolateral junctional complex (AJC) is generated during trophectoderm differentiation in the mouse blastocyst using molecular, structural and functional analyses. The mature AJC comprises an apical tight junction (TJ), responsible for intercellular sealing and blastocoel formation, and subjacent zonula adherens E-cadherin/catenin adhesion complex which also extends along lateral membrane contact sites. Dual labelling confocal microscopy revealed that the AJC derived from a single 'intermediate' complex formed following embryo compaction at the 8-cell stage in which the TJ-associated peripheral membrane protein, ZO-1alpha- isoform, was co-localized with both alpha- and beta-catenin. However, following assembly of the TJ transmembrane protein, occludin, from the early 32-cell stage when blastocoel formation begins, ZO-1alpha- and other TJ proteins (ZO-1alpha+ isoform, occludin, cingulin) co-localized in an apical TJ which was separate from a subjacent E-cadherin/catenin zonula adherens complex. Thin-section electron microscopy confirmed that a single zonula adherens-like junctional complex present at the AJC site following compaction matured into a dual TJ and zonula adherens complex at the blastocyst stage. Embryo incubation in the tracer FITC-dextran 4 kDa showed that a functional TJ seal was established coincident with blastocoel formation. We also found that rab13, a small GTPase previously localized to the TJ, is expressed at all stages of preimplantation development and relocates from the cytoplasm to the site of AJC biogenesis from compaction onwards with rab13 and ZO-1alpha- co-localizing precisely. Our data indicate that the segregation of the two elements of the AJC occurs late in trophectoderm differentiation and likely has functional importance in blastocyst formation. Moreover, we propose a role for rab13 in the specification of the AJC site and the formation and segregation of the TJ.