The feedback regulator Nord controls Dpp/BMP signaling via extracellular interaction with Dally in the Drosophila wing

The Drosophila BMP 2/4 homologue Decapentaplegic (Dpp) acts as a morphogen to regulate diverse developmental processes, including wing morphogenesis. Transcriptional feedback regulation of this pathway ensures tightly controlled signaling outputs to generate the precise pattern of the adult wing. Nevertheless, few direct Dpp target genes have been explored and our understanding of feedback regulation remains incomplete. Here, we employ transcriptional profiling following dpp conditional knockout to identify nord, a novel Dpp/BMP feedback regulator. Nord mutants generated by CRISPR/Cas9 mutagenesis produce a smaller wing and display low penetrance venation defects. At the molecular level, nord encodes a heparin-binding protein and we show that its overexpression is sufficient to antagonize Dpp/BMP signaling. Further, we demonstrate that Nord physically and genetically interacts with the Dpp/BMP co-receptor Dally. In sum we propose that Nord acts with Dally to fine tune Dpp/BMP signaling, with implications for both developmental and disease models. Impact statementFunctional analyses of the Drosophila homologue of Neuron Derived Neurotrophic Factor reveal a new mode of extracellular heparan sulfate proteoglycan regulation required for proper morphogen action.