Development of the metanephric kidney depends on precise control of branching of the ureteric bud. Branching events represent terminal bifurcations that are thought to depend on unique patterns of gene expression in the tip compared with the stalk and are influenced by mesenchymal signals. The metanephric mesenchyme-derived signals that control gene expression at the ureteric bud tip are not well understood. In mouse Sall1 mutants, the ureteric bud grows out and invades the metanephric mesenchyme, but it fails to initiate branching despite tip-specific expression of Ret and Wnt11. The stalk-specific marker Wnt9b and the beta-catenin downstream target Axin2 are ectopically expressed in the mutant ureteric bud tips, suggesting that upregulated canonical Wnt signaling disrupts ureter branching in this mutant. In support of this hypothesis, ureter arrest is rescued by lowering beta-catenin levels in the Sall1 mutant and is phenocopied by ectopic expression of a stabilized beta-catenin in the ureteric bud. Furthermore, transgenic overexpression of Wnt9b in the ureteric bud causes reduced branching in multiple founder lines. These studies indicate that Sall1-dependent signals from the metanephric mesenchyme are required to modulate ureteric bud tip Wnt patterning in order to initiate branching.