Identification of target genes that mediate required functions downstream of transcription factors is hampered by the large number of genes whose expression changes when the factor is removed from a specific tissue and the numerous binding sites for the factor in the genome. Retinoic acid (RA) regulates transcription via RA receptors bound to RA response elements (RAREs) of which there are thousands in vertebrate genomes. Here, we combined ChIP-seq for epigenetic marks and RNA-seq on trunk tissue from wild-type and Aldh1a2-/-embryos lacking RA synthesis that exhibit body axis and forelimb defects. We identified a relatively small number of genes with altered expression when RA is missing that also have nearby RA-regulated deposition of H3K27ac (gene activation mark) or H3K27me3 (gene repression mark) associated with conserved RAREs, suggesting they have important downstream functions. RA-regulated epigenetic marks were identified near RA target genes already known to be required for body axis and limb formation, thus validating our approach, plus many other candidate RA target genes were found. Nr2f1, Nr2f2, Meis1, and Meis2 gene family members were identified by our approach, and double knockouts of each family demonstrated previously unknown requirements for body axis and/or limb formation. These findings demonstrate that our method for identifying RA-regulated epigenetic marks can be used to discover genes important for development.