The purpose of the thesis is to explore the role of BMP signaling in developing vertebrate midbrain. BMP signaling plays important roles in various tissues and stages of neural development to regulate cell fate, proliferation, differentiation, morphogenesis and more. We observed that several major BMPs are expressed not only at the roof plate but also the floor plate of the midbrain. This has led us to ask the role of BMP signaling in dorsal and ventral midbrain patterning. Despite ventral experiments, we found that BMP signaling does not regulate ventral cell fate specification in the midbrain. Instead BMPs profoundly influence the shape and early morphogenesis of the midbrain neural plate as it closes into a neural tube. During neural tube closure, one of the early events occurring at the ventral midline is median hinge point (MHP) formation. Failure to form MHP leads to neural tube closure defects, the 2nd most common birth defects in humans. However, the molecular mechanisms underlying MHP formation are not well known. We found that the lowest BMP signaling occurs at the MHP during early neurulation and BMP blockade is necessary and sufficient for MHP formation. Interestingly, we also demonstrated that BMP blockade directs MHP formation by regulating the apicobasal polarity pathway and this regulation may be mediated by biochemical interactions between pSMAD5 and the apical protein, PAR3. Additionally, our time-lapse data suggest that BMP blockade slows cell cycle progression by increasing duration of G1 to S transition and S phase which leads cell nuclei stay at the basal location longer. This mimics basal nuclear migration seen at the MHP where low BMP signaling occurs. Thus, we conclude that BMP signaling regulates neural tube closure via the apicobasal polarity pathway and in a cell cycle dependent manner at the ventral midline. We observed that BMP signaling is necessary and sufficient for the dorsal cell fate specification in a context-dependent manner and ventral BMP signaling affects dorsal cell fates. Taken together, we propose the idea that BMP signaling has distinct roles in different contexts. BMPs regulate tissue morphogenesis in the ventral midbrain and dorsally cell fate specification. / text