This gene encodes a secreted protein that interacts with, and inhibits bone morphogenetic protein (BMP) function. It has been shown to inhibit BMP2- and BMP4-dependent osteoblast differentiation and BMP-dependent differentiation of the chondrogenic cells. Mutations in this gene are associated with a lethal skeletal disorder, diaphanospondylodysostosis. [provided by RefSeq, Dec 2011].