Fras1 encodes an extracellular matrix protein that is critical for the establishment of the epidermal basement membrane during gestation. In humans, mutations in FRAS1 cause Fraser Syndrome (FS), a pleiotropic condition with many clinical presentations such as limb, eye, kidney, and craniofacial deformations. Many of these defects are mimicked by loss of Fras1 in mice, and are preceded by the formation of epidermal blisters in utero. In this study, we identified a novel ENU-derived rounded foot (rdf) mouse mutant with highly penetrant hindlimb soft-tissue syndactyly among other structural defects. Mapping and sequencing revealed that rdf is a novel loss-of-function nonsense allele of Fras1 (Fras1rdf). Focusing on the limb, we found that the Fras1rdf syndactyly phenotype originates from loss of interdigital cell death (ICD). Despite normal expression of BMP ligands and their receptors, the BMP downstream target gene Msx2, which is also necessary and sufficient to promote ICD, was downregulated in the interdigital regions of Fras1rdf hindlimb buds. The close correlation between limb bud epidermal blistering, decreased Msx2 expression and reduced ICD suggest that epithelium detachment from the mesenchyme may create a physical gap that interrupts the transmission of BMP among other signals, resulting in soft tissue syndactyly.