Sox17 is a transcription factor that is required for maintenance of the definitive endoderm in mouse embryos. By expression profiling of wild-type and mutant embryos and Sox17-overexpressing hepatoma cells, we identified genes with Sox17-dependent expression. Among the genes that were up-regulated in Sox17-null embryos and down-regulated by Sox17 expressing HepG2 cells is a set of genes that are expressed in the developing liver, suggesting that one function of Sox17 is the repression of liver gene expression, which is compatible with a role for Sox17 in maintaining the definitive endoderm in a progenitor state. Consistent with these findings, Sox17(-/-) cells display a diminished capacity to contribute to the definitive endoderm when transplanted into wild-type hosts. Analysis of gene ontology further revealed that many genes related to heart development were downregulated in Sox17-null embryos. This is associated with the defective development of the heart in the mutant embryos, which is accompanied by localised loss of Myocd-expressing cardiogenic progenitors and the malformation of the anterior intestinal portal.