The molecular mechanisms controlling inductive events leading to the specification and terminal differentiation of cardiomyocytes are still largely unknown. We have investigated the role of Cripto, an EGF-CFC factor, in the earliest stages of cardiomyogenesis. We find that both the timing of initiation and the duration of Cripto signaling are crucial for priming differentiation of embryonic stem (ES) cells into cardiomyocytes, indicating that Cripto acts early to determine the cardiac fate. Furthermore, we show that failure to activate Cripto signaling in this early window of time results in a direct conversion of ES cells into a neural fate. Moreover, the induction of Cripto activates the Smad2 pathway, and overexpression of activated forms of type I receptor ActRIB compensates for the lack of Cripto signaling in promoting cardiomyogenesis. Finally, we show that Nodal antagonists inhibit Cripto-regulated cardiomyocyte induction and differentiation in ES cells. All together our findings provide evidence for a novel role of the Nodal/Cripto/Alk4 pathway in this process.