Background: Embryonic morphogenesis of vascular and muscular systems is tightly coordinated, and a functional cooperation of Mtmr8 with PI3K in actin filament modeling and muscle development has been revealed in zebrafish. Here, we attempt to explore the function of Mtmr8 in vasculature development parallel to its function in muscle development. Results: During early stage of somitogenesis, mtmr8 expression was detected in both somitic mesodem and ventral mesoderm. Knockdown of mtmr8 by morpholino impairs arterial endothelial marker expression, and results in endothelial cell reduction and vasculogenesis defects, such as retardation in intersegmental vessel development and interruption of trunk dorsal aorta. Moreover, mtmr8 morphants show loss of arterial endothelial cell identity in dorsal aorta, which is effectively rescued by low concentration of PI3K inhibitor, and by over-expression of dnPKA mRNA or vegf mRNA. Interestingly, mtmr8 expression is up-regulated when zebrafish embryos are treated with specific inhibitor of Hedgehog pathway that abolishes arterial marker expression. Conclusion: These data indicate that Mtmr8 is essential for vasculature development in zebrafish embryos, and may play a role in arterial specification through repressing PI3K activity. It is suggested that Mtmr8 should represent a novel element of the Hedgehog/PI3K/VEGF signaling cascade that controls arterial specification