Jawed vertebrates (Gnasthostomes) are broadly separated into cartilaginous fishes (Chondricthyes) and bony vertebrates (Osteichthyes). Cartilaginous fishes are divided into chimaeras (e.g. ratfish, rabbit fish and elephant shark) and elasmobranchs (e.g. sharks, rays and skates). Both cartilaginous fish and bony vertebrates are believed to have a common armoured bony ancestor (Class Placodermi), however cartilaginous fish are believed to have lost bone. This study has identified and investigated genes involved in skeletal development in vertebrates, in the cartilaginous fish, elephant shark (Callorhinchus milii). Ctnnb1 (β-catenin), Sfrp (secreted frizzled protein) and a single Sost or Sostdc1 gene (sclerostin or sclerostin domain-containing protein 1) were identified in the elephant shark genome and found to be expressed in a number of tissues, including cartilage. β-catenin was also localized in several elephant shark tissues. The expression of these genes, which belong to the Wnt/β-catenin pathway, is required for normal bone formation in mammals. These findings in the cartilaginous skeleton of elephant shark support the hypothesis that the common ancestor of cartilaginous fishes and bony vertebrates had the potential for making bone.