Abstract The embryonic urogenital system (UGS) generates the metanephric kidney, gonad and the adrenal gland. It is well known that the development of the UGS is regulated by sequential and reciprocal epithelial and mesenchymal tissue interactions but the secreted mediators involved are still poorly known. The action of such inductive signals is typically regulated by specific antagonists. The Sprouty (Spry) proteins compose one family of cytoplasmic regulators that typically repress the function of the receptor tyrosine kinase (RTK) signal transduction pathways. The DAN/Cerberus (Cer) family that encodes secreted proteins bind and antagonize the Bmp, Wnt and Nodal signals. In this study the roles of Spry and Cer1 was addressed during mouse UGS development by targeted expression of SPROUTY2 (SPRY2) and Cer1 in the ureteric bud and Wolffian duct under the Pax2 promoter. Changes induced in the UGS assembly process were analyzed in detail to reveal the normal developmental roles of these proteins. SPRY2 expression led to either complete lack of the kidney, reduction in the kidney size or formation of unilateral kidney with reduced size. The SPRY2 mediated reduction in kidney size was accompanied by inhibition of expression of genes that are known to regulate kidney development. The results indicated that the Spry may take part in kidney development by coordinating the reciprocal cell signaling between the ureteric bud, the mesenchymal cells and stromal cells. In addition to the kidney, the gain of SPRY2 function revealed an important role in the control of male gonadogenesis. SPRY2 over expression in the Wolffian duct malformed the Wolffian duct derivatives, diminished the number of seminiferous tubules and the amount of the interstitial tissue associated with reduced mesonephric cell migration to the testis. Exogenous FGF9 rescued mesonephric cell migration inhibited by SPRY2. It was concluded that Spry protein contribute to male sexual organogenesis by antagonizing Fgf9 signaling. When the Cer1 gene was over expressed in the ureteric bud this lead unexpectedly to increased kidney size. The Cer1 mediated promotion of kidney size was demonstrated to involve enhanced ureteric bud morphogenesis. At the molecular level Cer1 protein function lead to inhibition of Bmp4 gene expression and concurrent upregulation of Gdnf and Wnt11 expression. Notably, excess BMP4 reduced the Cer1 stimulated ureteric bud branching and downregulated normally expression of Gdnf and Wnt11 in the embryonic kidney. Based on the presented data it is proposed that the establishment of mammalian organ size is under the control of both systemic and the intrinsic factors. Together the work demonstrates significant roles for the proteins that typically inhibit growth factor signaling or signal transduction. Hence organogenesis is controlled by coordination between positive and negative growth factor regulator signals.