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Local application of retinoic acid to chick embryos produces severe bilateral clefting of the primary palate but does not affect the lower beak. This paper reviews what is known about the basis and specificity of this retinoid-induced defect by examining three major developmental processes: morphogenesis, cell differentiation, and pattern formation. The conclusion reached is that neither cytotoxicity nor cartilage inhibition is the basis of the specific retinoid-induced defect. Retinoid treatment interferes with reciprocal epithelial-mesenchymal interactions in the upper beak. These interactions are involved in linking pattern formation--the spatial ordering of cell differentiation--to morphogenesis and outgrowth. These results suggest that retinoids are interfering with the process of pattern formation in the upper beak, a conclusion that is supported by the similarities between retinoid effects on face and limb development. Thus, it appears that retinoids may be acting as general signaling molecules throughout the developing embryo. In the lower beak, pattern-forming cues may occur earlier in development. Alternatively, the cells may be unresponsive to retinoids. The molecular basis for the specificity of the facial defect--as well as for the action of retinoids on developing systems--is discussed with reference to recent advances in molecular biology.