To better understand the mechanisms that give rise to differences between dorsal and ventral skin and to the boundary between them, we have determined how several morphologic characteristics vary along the dorsoventral axis of the mouse and how these characteristics correspond to ventral-specific Agouti expression and the lineage boundary that distinguishes somite from lateral plate derivatives. Our results indicate that the apparent uniformity of the dorsoventral boundary represents the sum of independent mechanisms that affect melanocyte density and/or differentiation, pigment-type synthesis, and hair length; surprisingly, none of these coincide with the somite–lateral plate lineage boundary. We also make use of a classical mouse mutation, droopy ear (Curry 1959), that produces a dorsal-to-ventral transformation of flank coat color by allowing expansion of the ventral-specific Agouti transcript. By positional cloning and gene targeting, we identify an allele of droopy ear, deH, as a loss of function for Tbx15, which encodes a T-box transcription factor expressed in a dynamic and spatially restricted manner in the developing skin and musculoskeletal system. Embryonic expression and transplantation studies suggest that Tbx15 is required to establish certain characteristics of dorsal patterning in mesenchymal cells of the developing flank. These results identify a previously unappreciated aspect of dorsoventral patterning that is widely represented in furred mammals and provide insight into the mechanisms that underlie region-specific differences in body morphology.