Factors that regulate cellular migration during embryonic development are essential for tissue and organ morphogenesis. Scatter factor/hepatocyte growth factor (SF/HGF) can stimulate motogenic and morphogenetic activities in cultured epithelial cells expressing the Met tyrosine kinase receptor and is essential for development; however, the precise physiological role of SF/HGF is incompletely understood. Here we provide functional evidence that inappropriate expression of SF/HGF in transgenic mice influences the development of two distinct migratory cell lineages, resulting in ectopic skeletal muscle formation and melanosis in the central nervous system, and patterned hyperpigmentation of the skin. Committed TRP-2 positive melanoblasts were found to be situated aberrantly within defined regions of the transgenic embryo, including the neural tube, which overproduced SF/RGF. Our data strongly suggest that SF/HGF possesses physiologically relevant scatter activity, and functions as a true morphogenetic factor by regulating migration and/or differentiation of select populations of premyogenic and neural crest cells during normal mammalian embryogenesis.