CCCTC-binding factor (CTCF) is a nuclear zinc-finger protein that displays insulating activity in a variety of biological assays. For example, CTCF-binding sites have been suggested to isolate Hox gene clusters from neighboring transcriptional interference. We investigated this issue during limb development, where Hoxd genes must remain isolated from long-range effects to allow essential regulation within independent sub-groups. We used conditional Ctcf inactivation in incipient forelimbs and show that the overall pattern of Hoxd gene expression remains unchanged. Transcriptome analysis using tiling arrays covering chromosomes 2 and X confirmed the weak effect of CTCF depletion on global gene regulation. However, Ctcf deletion caused massive apoptosis, leading to a nearly complete loss of limb structure at a later stage. We conclude that, at least in this physiological context, rather than being an insulator, CTCF is required for cell survival via the direct transcriptional regulation of target genes critical for cellular homeostasis.