We have identified in Caenorhabditis elegans a homologue of the vertebrate Crim1, crm-1, which encodes a putative transmembrane protein with multiple cysteine-rich (CR) domains known to have bone morphogenetic proteins (BMPs) binding activity. Using the body morphology of C. elegans as an indicator, we showed that attenuation of crm-1 activity leads to a small body phenotype reminiscent of that of BMP pathway mutants. We showed that the crm-1 loss-of-function phenotype can be rescued by constitutive supply of sma-4 activity. crm-1 can enhance BMP signaling and this activity is dependent on the presence of the DBL-1 ligand and its receptors. crm-1 is expressed in neurons at the ventral nerve cord, where the DBL-1 ligand is produced. However, ectopic expression experiments reveal that crm-1 gene products act outside the DBL-1 producing cells and function non-autonomously to facilitate dbl/sma pathway signaling to control body size.