AbstractRetinoic acid (RA), a derivative of vitamin A, is essential for normal mammalian development. Developmental abnormalities induced by RA excess and vitamin A deficiency are different even though they affect the same organ systems, and it is clear that there are intraembryonic tissue differences in the requirement for RA. The developmental functions of RA are mediated by its effects on gene expression. In the nucleus, two different forms of RA bind to and activate two families of nuclear receptors, which themselves co‐operate in initiating the transcription of target genes. In this article I propose that the amount of RA reaching the nucleus in different embryonic tissues is modulated by a mechanism involving three cytoplasmic binding proteins for retinol (CRBP I) and retinoic acid (CRABP I and II). Abnormalities of craniofacial development resulting from exposure of early neural plate stage embryos to RA excess have been studied in some detail; their initial stages involve alteration of both morphological development and the segment‐specific pattern of gene expression in the early hindbrain and its derived neural crest. This system is ideal for studying the relationships between retinoic acid receptors, retinoid binding proteins, and the development of genetic and morphological patt