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Bone morphogenetic proteins (BMPs) play many roles in mammalian cardiac development. Here we address the functions of Noggin, a dedicated BMP antagonist, in the developing mouse heart. In early cardiac tissues, the Noggin gene is mainly expressed in the myocardial cells of the outflow tract, atrioventricular canal, and future right ventricle. The major heart phenotypes of Noggin mutant embryos are thicker myocardium and larger endocardial cushions. Both defects result from increased cell number. Cell proliferation is increased and cell cycle exit is decreased in the myocardium. Although we find evidence of increased BMP signal transduction in the myocardium and endocardium, we show that the cardiac defects of Noggin mutants are rescued by halving the gene dosage of Bmp4. In culture, BMP increases the epithelial-to-mesenchymal transformation (EMT) of endocardial explant cells. Increased EMT likely accounts for the enlarged atrioventricular cushion. In the outflow tract cushion, we observed an increased contribution of cardiac neural crest cells to the mutant cushion mesenchyme, although many cells of the cushion were not derived from neural crest. Thus the enlarged outflow tract cushion of Noggin mutants likely arises by increased contributions both of endocardial cells that have undergone EMT as well as cells that have migrated from the neural crest. These data indicate that antagonism of BMP signaling by Noggin plays a critical role in ensuring proper levels of cell proliferation and EMT during cardiac morphogenesis in the mouse.