Interactions between Wnts, Fgfs and Tbx genes are involved in limb initiation and the same gene families have been implicated in mammary gland development. Here we explore how these genes act together in mammary gland initiation. We compared expression of Tbx3, the gene associated with the human condition ulnar–mammary syndrome, expression of the gene encoding the dual-specificity MAPK phosphatase Pyst1/MKP3, which is an early response to FGFR1 signalling (as judged by sensitivity to the SU5402 inhibitor), and expression of Lef1, encoding a transcription factor mediating Wnt signalling and the earliest gene so far known to be expressed in mammary gland development. We found that Tbx3 is expressed earlier than Lef1 and that Pyst1 is also expressed early but only transiently. Patterns of expression of Tbx3, Pyst1 and Lef1 in different glands suggest that the order of mammary gland initiation is 3, 4, 1, 2 and 5. Consistent with expression of Pyst1 in the mammary gland, we detected expression of Fgfr1b, Fgf8 and Fgf9 in both surface ectoderm and mammary bud epithelium, and Fgf4 and Fgf17 in mammary bud epithelium. Beads soaked in FGF-8 applied to the flank of mouse embryos, at a stage just prior to mammary bud initiation, induce expression of Pyst1 and Lef1 and maintain Tbx3 expression in flank tissue surrounding the bead. Grafting beads soaked in the FGFR1 inhibitor, SU5402, abolishes Tbx3, Pyst1 and Lef1 expression, supporting the idea that FGFR1 signalling is required for early mammary gland initiation. We also showed that blocking Wnt signalling abolishes Tbx3 expression but not Pyst1 expression. These data, taken together with previous findings, suggest a model in which Tbx3 expression is induced and maintained in early gland initiation by both Wnt and Fgf signalling through FGFR1.