Response to the steroid hormone ecdysone in Drosophila is controlled by genetic regulatory hierarchies that include eight members of the nuclear receptor protein family. The DHR3 gene, located within the 46F early-late ecdysone-inducible chromosome puff, encodes an orphan nuclear receptor that recently has been shown to exert both positive and negative regulatory effects in the ecdysone-induced genetic hierarchies at metamorphosis. We used a reverse genetics approach to identify 11 DHR3 mutants from a pool of lethal mutations in the 46F region on the second chromosome. Two DHR3 mutations result in amino acid substitutions within the conserved DNA binding domain. Analysis of DHR3 mutants reveals that DHR3 function is required to complete embryogenesis. All DHR3 alleles examined result in nervous system defects in the embryo.