Anural development in the ascidian Molgula occulta was examined using tissue-specific markers and interspecific hybridization. Unlike most ascidians, which develop into a swimming tadpole larva (urodele development), M. occulta eggs develop into a tailless slug-like larva (anural development) which metamorphoses into an adult. M. occulta embryos show conventional early cleavage patterns, gastrulation, and neurulation, but then diverge from the urodele developmental mode during larval morphogenesis. M. occulta larvae do not contain a pigmented sensory cell in their brain or form a tail with differentiated notochord and muscle cells. As shown by in situ hybridization with cloned probes and analysis of in vitro translation products, M. occulta embryos do not accumulate high levels of alpha actin or myosin heavy chain mRNA. In contrast, acetylcholinesterase is expressed in muscle lineage cells, indicating that various muscle cell features are differentially suppressed. M. occulta embryos also lack tyrosinase activity, suggesting that suppression of brain pigment cell differentiation occurs at an early step in development. M. occulta eggs fertilized with sperm from Molgula oculata (a closely related urodele species) develop into hybrid larvae exhibiting some of the missing urodele features. Some hybrid embryos develop tyrosinase activity and differentiate a brain pigment cell and a short row of notochord cells, and form a short tail. These urodele features appeared together or separately in different hybrid embryos suggesting that they develop by independent mechanisms. In contrast, alpha actin and myosin heavy chain mRNA accumulation was not enhanced in hybrid embryos. These results suggest that multiple mechanisms control anural development.