We previously reported the isolation of a cDNA clone for a homeobox-containing gene designated Pem, shown by Northern analysis of Day 7 through Day 16 mouse embryos to be expressed in extraembryonic tissues. In this study, Pem gene expression was further examined using in situ hybridization and immunocytochemistry to determine the spatial distribution of Pem transcripts and protein in peri-implantation embryos and in embryoid bodies (EBs). Low amounts of Pem mRNA were detected in undifferentiated EBs. When EBs were induced to differentiate, the outer cell layer of visceral or parietal endoderm expressed both Pem mRNA and protein. In developing embryos, no Pem protein was detectable in the uncompacted morula; 12% of the nuclei in compacted morulae were Pem positive, while 25% of the blastocyst trophectoderm and 15% of inner cell mass cells expressed Pem protein. Shortly after implantation, in 5.5 and 6.5 d.p.c. embryos, Pem expression was limited to extraembryonic tissues and was present in distal and proximal visceral endoderm, parietal endoderm, and ectoplacental cone. By 7.5-8.5 d.p.c. neither Pem RNA nor protein was found in the distal squamous visceral endoderm, which surrounds the embryonic region of the egg cylinder, nor in the parietal endoderm. Expression was retained in the proximal columnar epithelium of the visceral endoderm. Prominent Pem expression was observed in the chorion, in trophoblast-derived cells of the ectoplacental cone, and in secondary giant cells, localized in the nuclear compartment. Pem was localized to the X chromosome and found to be expressed in cell lineages where only the maternal X chromosome is active. The data indicate a possible role for Pem in regulating genes involved in the differentiation of extraembryonic tissues.