Exposure to appropriate levels of thyroid hormones (THs) at the right time is of key importance for normal development in all vertebrates. Type 3 iodothyronine deiodinase (D3) is the prime TH-inactivating enzyme, and its expression is highest in the early stages of vertebrate development, implying that it may be necessary to shield developing tissues from overexposure to THs. We used antisense morpholino knockdown to examine the role of D3 during early development in zebrafish. Zebrafish possess 2 D3 genes, dio3a and dio3b. Here, we show that both genes are expressed during development and both contribute to in vivo D3 activity. However, dio3b mRNA levels inembryosare higher, and the effects of dio3b knockdown on D3 activity and on the resulting phenotype are more severe. D3 knockdown induced an overall delay in development, as determined by measurements of otic vesicle length, eye and ear size, and body length. The time of hatching was also severely delayed in D3-knockdown embryos. Importantly, we also observed a severe disturbance of several aspects of development. Swim bladder development and inflation was aberrant as was the development of liver and intestine. Furthermore, D3-knockdown larvae spent significantly less time moving, and both embryos and larvae exhibited perturbed escape responses, suggesting that D3 knockdown affects muscle development and/or functioning. These data indicate that D3 is essential for normal zebrafish embryonic and early larval development and show the value of morpholino knockdown in this model to further elucidate the specific role of D3 in some aspects of vertebrate development.