The Sonic hedgehog gene has been identified as a candidate for the signal mediating the function of the zone of polarizing activity (ZPA) during limb development in tetrapods. To better understand the early steps of development of paired fin buds in fish, we have analyzed the regulation of the zebrafish Sonic hedgehog gene (shh/vhh-1) in response to retinoic acid. Systemic administration of retinoic acid (RA) to zebrafish embryos during the initial stages of pectoral fin bud development resulted in the induction of ectopic expression of shh/vhh-1 on the anterior margin of the bud under the apical ectodermal ridge and in abnormal pectoral fin bud morphology. RA treatment also resulted in ectopic shh/vhh-1 expression in floor plate cells at the caudal end of the neural keel. These results suggest that the control of ZPA function during the initial stages of development of paired appendages has been conserved between fish and tetrapods.