Mechanisms underlying the multiple developmental defects observed in Fanconi anemia (FA) patients are not well defined. We have identified the zebrafish homolog of human FANCD2, which encodes a nuclear effector protein that is monoubiquitinated in response to DNA damage, targeting it to nuclear foci where it preserves chromosomal integrity. Fancd2-deficient zebrafish embryos develop defects similar to those found in children with FA, including shortened body length, microcephaly, and microophthalmia, which are due to extensive cellular apoptosis. Developmental defects and increased apoptosis in Fancd2-deficient zebrafish were corrected by injection of human FANCD2 or zebrafish bcl2 mRNA, or by knockdown of p53, indicating that in the absence of Fancd2, developing tissues spontaneously undergo p53-dependent apoptosis. Thus, Fancd2 is essential during embryogenesis to prevent inappropriate apoptosis in neural cells and other tissues undergoing high levels of proliferative expansion, implicating this mechanism in the congenital abnormalities observed in human infants with FA.