The inductive interactions between activin-induced and non-induced cells were investigated in newt animal cap explants. A wide range of concentrations of activin A (0.1-100 ng/ml) induced mesodermal tissues in the animal caps, but at generally low frequencies. Animal caps treated with 100 ng/ml of activin A, on the other hand, differentiated solely into nonspecific endoderm. At this concentration, various mesodermal tissues were induced in addition to endoderm as the animal caps increased in size. They were more frequently induced in explants in which the activin-treated animal caps were combined with untreated animal caps. Central nervous systems were frequently induced in sandwich explants with larger amounts of untreated animal caps. Differentiation of endodermal organs such as the liver, the pancreas and the intestine in the long-term cultured sandwich explants was confirmed by electron microscopy. Lineage tracing of the combination and sandwich explants revealed that the activin-treated animal caps mainly formed the endoderm and induced mesodermal and neural tissues in the untreated animal caps. These results suggest that activin A is capable of inducing the endoderm that can act as an initiator of further inductive interactions in early newt development.