Aberrant regulation of signal transduction pathways can adversely derail biological processes for tissue development. One such process is the embryonic eyelid closure that is dependent on the Mitogen-Activated Protein Kinase Kinase Kinase 1 (MAP3K1). Map3k1 knockout in mice results in defective eyelid closure and an autosomal recessive eye-open at birth phenotype. We have shown that in utero exposure to dioxin, a persistent environmental toxicant, induces the same eye defect in Map3k1+/- heterozygous but not wild type pups. Here we explore the mechanisms of the Map3k1 (gene) and dioxin (environment) interactions (GxE) underlying defective eyelid closure. We show that, acting through the Aryl Hydrocarbon Receptor (AHR), dioxin activates Epidermal Growth Factor Receptor (EGFR) signaling, which in turn depresses MAP3K1-dependent Jun N-terminal Kinase (JNK) activity. The dioxin mediated JNK repression is moderate but is exacerbated by Map3k1 heterozygosity. Therefore, dioxin exposed Map3k1+/- embryonic eyelids have a marked reduction of JNK activity, accelerated differentiation and impeded polarization in the epithelial cells. Knocking out Ahr or Egfr in eyelid epithelium attenuates the open-eye defects in dioxin-treated Map3k1+/- pups, whereas knockout of Jnk1 and S1pr that encodes the Sphigosin-1-phosphate (S1P) receptors upstream of the MAP3K1-JNK pathway potentiates the dioxin toxicity. Our novel findings show that the crosstalk of AHR, EGFR and S1P-MAP3K1-JNK pathways determines the outcome of dioxin exposure. Thus, gene mutations targeting these pathways are potential risk factors for the toxicity of environmental chemicals.