We have engineered a mouse mutation that specifically deletes the C-terminal 18 amino acid sequence of the RXRalpha protein. This deletion corresponds to the last helical alpha structure (H12) of the ligand-binding domain (LBD), and includes the core of the Activating Domain of the Activation Function 2 (AF-2 AD core) that is thought to be crucial in mediating ligand-dependent transactivation by RXRalpha. The homozygous mutants (RXRalpha af2(o)), which die during the late fetal period or at birth, exhibit a subset of the abnormalities previously observed in RXRalpha -/- mutants, often with incomplete penetrance. In marked contrast, RXRalpha af2(o)/RXRbeta -/- and RXRalpha af2(o)/RXRbeta -/- /RXRgamma -/- compound mutants display a large array of malformations, which nearly recapitulate the full spectrum of the defects that characterize the fetal vitamin A-deficiency (VAD) syndrome and were previously found in RAR single and compound mutants, as well as in RXRalpha/RAR(alpha, beta or gamma) compound mutants. Analysis of RXRalpha af2(o)/RAR(alpha, beta or gamma) compound mutants also revealed that they exhibit many of the defects observed in the corresponding RXR alpha/RAR compound mutants. Together, these results demonstrate the importance of the integrity of RXR AF-2 for the developmental functions mediated by RAR/RXR heterodimers, and hence suggest that RXR ligand-dependent transactivation is instrumental in retinoid signalling during development.