Gonad morphogenesis relies on the correct spatiotemporal expression of a number of genes that together fulfill the differentiation of the bipotential gonad into testes or ovaries. As such, the transcription factors WT1 and GATA4 are pivotal for proper gonadal development. Here we address the contributions of GATA4 and WT1 to the sex differentiation phase in testes and ovaries. We applied an ex vivo technique for cultivating gonads in hanging droplets of media that were supplemented with vivo-morpholinos to knockdown WT1 and GATA4 either alone or in combination at the same developmental stage. We show that WT1 is equally important for both, the initial establishment and the maintenance of the sex-specific gene expression signature in testes and ovaries. We further identified Foxl2 as a novel putative downstream target gene of WT1. Moreover, knockdown of WT1 reduced mRNA levels of several molecular components of the hedgehog signaling pathway in XY gonads, whereas Gata4 vivo-morpholino treatment increased transcripts of Dhh and Ptch1 in embryonic testes. The data suggest that for its proper function, WT1 relies on the correct expression of the GATA4 protein. Furthermore, GATA4 down-regulates several ovarian promoting genes in testes, such as Ctnnb1, Fst, and Bmp2, suggesting that this repression is required for maintaining the male phenotype. In conclusion, this study provides novel insights into the role of WT1 and GATA4 during the sex differentiation phase and represents an approach that can be applied to assess other proteins with as yet unknown functions during gonadal development.