The formation of the dorsoventral (DV) boundary is central to establishing the body plan in embryonic development. Although there is some information about how limbs are positioned along the DV axis and how DV skin color pattern is determined, the way in which mammary glands are positioned is unknown. Here we focus on Bmp4 and Tbx3, a gene associated with ulnar-mammary syndrome, and compare their expression along the DV axis in relation to mammary gland initiation in mouse embryos. Tbx3 is expressed in the mammary gland-forming region with Tbx15, a gene involved in a DV coat color being expressed more dorsally and Bmp4 being expressed more ventrally. When Tbx3 was overexpressed, formation of mammary gland epithelium was extended along the DV axis. In contrast, overexpression of Bmp4 inhibited both Tbx3 and Tbx15 expression. In addition, when BMP signaling was inhibited by NOGGIN, Lef1 expression was lost. Thus, we propose that mutual interactions between Bmp4 and Tbx3 determine the presumptive DV boundary and formation of mammary glands in early mouse embryogenesis. 1,19-Dioctadecyl-3,3,39,39-tetramethyl indocarbocyanine perchloride labeling experiments showed that cells associated with mammary glands originate more dorsally and then move ventrally. This finding, together with previous findings, suggests that the same DV boundary may not only position limbs and determine coat color but also position mammary glands. Furthermore, Bmp signaling appears to be a fundamental feature of DV patterning.