Background: Wnt proteins are conserved signaling molecules that regulate pattern formation during animal development. Many Wnt proteins are post-translationally modified by addition of lipid adducts. Wnt8a provides a crucial signal for patterning the anteroposterior axis of the developing neural plate in vertebrates. However, it is not clear how this protein propagates from its source, the blastoderm margin, to the target cells in the prospective neural plate, and how lipidmodifications might influence Wnt8a propagation and activity. Results: We have dynamically imaged biologically active, fluorescently tagged Wnt8a in living zebrafish embryos. We find that Wnt8a localizes to membrane-associated, punctate structures in live tissue. In Wnt8a expressing cells, these puncta are found on filopodial cellular processes, from where the protein can be released. In addition, Wnt8a is found colocalized with Frizzled receptor-containing clusters on signal receiving cells. Combining in vitro and in vivo assays, we compare the roles of conserved Wnt8a residues in cell and non-cell-autonomous signaling activity and secretion. Non-signaling Wnt8 variants show these residues can regulate Wnt8a distribution in producing cell membranes and filopodia as well as in the receiving tissue. Conclusions: Together, our results show that Wnt8a forms dynamic clusters found on filopodial donor cell and on signal receiving cell membranes. Moreover, they demonstrate a differential requirement of conserved residues in Wnt8a protein for distribution in producing cells and receiving tissue and signaling activity during neuroectoderm patterning.