The matrix metalloproteinase (MMP) stromelysin-3 (ST3) was originally discovered as a gene whose expression was associated with human breast cancer carcinomas and with apoptosis during organogenesis and tissue remodeling. It has been shown previously, in our studies as well as those by others, that ST3 mRNA is highly upregulated during apoptotic tissue remodeling during Xenopus laevis metamorphosis. Using a function-blocking antibody against the catalytic domain of Xenopus ST3, we demonstrate here that ST3 protein is specifically expressed in the cells adjacent to the remodeling extracellular matrix (ECM) that lies beneath the apoptotic larval intestinal epithelium in X. laevis in vivo, and during thyroid hormone–induced intestinal remodeling in organ cultures. More importantly, addition of this antibody, but not the preimmune antiserum or unrelated antibodies, to the medium of intestinal organ cultures leads to an inhibition of thyroid hormone–induced ECM remodeling, apoptosis of the larval epithelium, and the invasion of the adult intestinal primodia into the connective tissue, a process critical for adult epithelial morphogenesis. On the other hand, the antibody has little effect on adult epithelial cell proliferation. Furthermore, a known MMP inhibitor can also inhibit epithelial transformation in vitro. These results indicate that ST3 is required for cell fate determination and cell migration during morphogenesis, most likely through ECM remodeling.