Wnt glycoproteins control key processes during development and disease by activating various downstream pathways. Wnt secretion requires post-translational modification mediated by the O-acyltransferase encoded by the Drosophila porcupine homolog gene (PORCN). In humans, PORCN mutations cause focal dermal hypoplasia (FDH, or Goltz syndrome), an X-linked dominant multisystem birth defect that is frequently accompanied by ocular abnormalities such as coloboma, microphthalmia, or even anophthalmia. Although genetic ablation of Porcn in mouse has provided insight into the etiology of defects caused by ectomesodermal dysplasia in FDH, the requirement for Porcn and the actual Wnt ligands during eye development have been unknown. In this study, Porcn hemizygosity occasionally caused ocular defects reminiscent of FDH. Conditional inactivation of Porcn in periocular mesenchyme led to defects in mid- and hindbrain and in craniofacial development, but was insufficient to cause ocular abnormalities. However, a combination of conditional Porcn depletion in optic vesicle neuroectoderm, lens, and neural crest-derived periocular mesenchyme induced severe eye abnormalities with high penetrance. In particular, we observed coloboma, transdifferentiation of the dorsal and ventral retinal pigment epithelium, defective optic cup periphery, and closure defects of the eyelid, as well as defective corneal morphogenesis. Thus, Porcn is required in both extraocular and neuroectodermal tissues to regulate distinct Wnt-dependent processes during morphogenesis of the posterior and anterior segments of the eye.