An isolated cDNA encoding a growth-inducing protein, Frzb, capable of stimulating bone, cartilage, muscle and nerve tissue formation. Frzb binds to and modulates the activity of Wnt growth factors which play a role in various developmental and neoplastic processes. The cDNA and protein sequences of human, bovine and Xenopus Frzb are provided. Production and purification of recombinant Frzb are also described.