We have examined the expression and regulation of cytoskeletal actin genes in ascidians with tailed (Molgula oculata) and tailless larvae (Molgula occulta). Four cDNA clones were isolated representing two pairs of orthologous cytoskeletal actin genes (CA1 and CA2), which encode proteins differing by five amino acids in the tailed and tailless species. The CA1 and CA2 genes are present in one or two copies, although several related genes may also be present in both species. Maternal CA1 and CA2 mRNA is present in small oocytes but transcript levels later decline, suggesting a role in early oogenesis. In the tailed species, embryonic CA1 and CA2 mRNAs first appear in the presumptive mesenchyme and muscle cells during gastrulation, subsequently accumulate in the presumptive notochord cells, and can be detected in these tissues through the tadpole stage. CA1 mRNAs accumulate initially in the same tissues in the tailless species but subsequently disappear, in concert with the arrest of notochord and tail development. In contrast, CA2 mRNAs were not detected in embryos of the tailless species. Fertilization of eggs of the tailless species with sperm of the tailed species, which restores the notochord and the tail, also results in the upregulation of CA1 and CA2 gene expression in hybrid embryos. Antisense oligodeoxynucleotide experiments suggest that CA1 and CA2 expression in the notochord, but not in the muscle cells, is dependent on prior expression of Mocc FHI, an ascidian HNF-3beta-like gene. The expression of the CA1 and CA2 genes in the notochord in the tailed species, downregulation in the tailless species, upregulation in interspecific hybrids, and dependence on HNF-3beta activity is consistent with a role of these genes in development of the ascidian notochord.