Wnt signaling plays a crucial role in directing cell differentiation, polarity, and growth [1–3]. In the canonical pathway, Wnt receptors activate Dishevelled (Dvl), which then blocks the degradation of a key signal transducer, β-catenin, leading to the nuclear accumulation of β-catenin and induction of Wnt target genes through TCF/LEF family transcription factors [1–3]. Here we identified a novel zebrafish gene encoding Ccd1, which possesses a DIX (Dishevelled-Axin) domain. DIX domains are essential for the signal transduction of two major Wnt downstream mediators, Dvl and Axin. Ccd1 formed homomeric and heteromeric complexes with Dvl and Axin and activated TCF-dependent transcription in vitro. In addition, overexpression of ccd1 in zebrafish embryos led to a reduction in the size of the eyes and forebrain (posteriorization), as seen with wnt8 overexpression [4–6], whereas a dominant-negative ccd1 (DN-ccd1) caused the opposite phenotype. Furthermore, the Wnt activation phenotype induced by ccd1 was inhibited by the expression of axin1 or DN-ccd1, and the wnt8 overexpression phenotype was rescued by DN-ccd1, suggesting that Ccd1 functions downstream of the Wnt receptor and upstream of Axin. These results indicate that Ccd1 is a novel positive regulator in this Wnt signaling pathway during zebrafish neural patterning.