Putative negative growth factor (PubMed:7958919). Antagonist of dpp, a protein involved in patterning the dorsal region and in the development of the neuroectoderm; dpp inhibition is enhanced by tsg (PubMed:7958919). Required for establishment of a narrow stripe of peak levels of BMP signaling in the dorsal midline of early embryos, that will give rise to the amnioserosa (PubMed:11260716). Component of a complex composed of dpp, sog and tsg (PubMed:11260716). Interacts with palmitoyltransferase Hip14 (PubMed:20599894). Abuts the dorsal dpp-expressing cells in a lateral stripe 14-16 cells wide. Later in embryogenesis it is expressed in neuroectoderm and in the endoderm spaced along the anterior-posterior axis of the developing gut. Embryogenesis. Palmitoylated, probably by Hip14. Belongs to the chordin family.