Hectd1 mutant mouse embryos exhibit the neural tube defect exencephaly associated with abnormal cranial mesenchyme. Cellular rearrangements in cranial mesenchyme are essential during neurulation for elevation of the neural folds. Here we investigate the molecular basis of the abnormal behavior of Hectd1 mutant cranial mesenchyme. We demonstrate that Hectd1 is a functional ubiquitin ligase and that one of its substrates is Hsp90, a chaperone protein with both intra- and extracellular clients. Extracellular Hsp90 enhances migration of multiple cell types. In mutant cranial mesenchyme cells, both secretion of Hsp90 and emigration of cells from cranial mesenchyme explants were enhanced. Importantly, we show that this enhanced emigration was highly dependent on the excess Hsp90 secreted from mutant cells. Together, our data set forth a model whereby increased secretion of Hsp90 in the cranial mesenchyme of Hectd1 mutants is responsible, at least in part, for the altered organization and behavior of these cells and provides a potential molecular mechanism underlying the neural tube defect.