|MadSci Network: Development|
Great question! This question is the foundation of the entire field of Developmental Biology - how do you get from a single cell (zygote) to an adult using a few strands of DNA as the guide. There are specific examples of the development of various tissues in the archives, so I'll limit this response to the general interpretation of the genome and the morphogenesis (shaping) of the embryo.
As I was organizing my thoughts regarding morphogenesis, I came up with an analogy that, through some internet kismet, showed up in my E-mail as today's Word-of-the-Day, Origami , which is defined as: "The art or process, originating in Japan, of folding paper into shapes representing flowers and birds, for example." (If you want more on origami, there is a complete archive at http://ccwf.cc.utexas.edu/~vbeatty/origami/ ) To make, say, a bird in origami, you start with a sheet of paper that looks nothing like a bird and fold it once. This first fold is basic to almost all origami designs, and has little to do with "bird". A couple more folds are added, and you get a "basic body" that underlies most of the "animal" origamis. With more work, the paper begins to take on more "bird-specific" folds, until the last few touches make it into a crane.
This is surprisingly similar to how embryogenesis works. By analogy, the developmental instructions contained within the genome are equivalent to the step-by-step origami instructions, where each genetic instruction says where and when a given fold should occur. Rather than contain a "blueprint" of the adult, and then organize the cells accordingly, the genome contains the step-by-step instructions on how to build an embryo, without any one step "knowing" what step comes next. Here's how to make a crane. First, the fertilized egg (zygote) divides several time to make a lump of cells (morula) which is common to all multicellular organisms. As the cells continue to divide, a cavity is formed at the center of the lump, such that the cells form something like a hollow ball (blastula - in amniotes, like birds, this is actually a blastodisc, because the huge amounts of yolk prevent forming an actual ball), that is common to almost all animal. This cavity is necessary for the next step which is literally a fold - one end of the hollow ball folds into the cavity to produce a lined ball with a hole at one end. This process, called gastrulation, forms the gut of the organism, and is essential to all higher animals, including insects, mollusks, and mammals. After establishing a rudamentary body plan, several interdependent genetic programs develop very primitive head, heart, tail, gut, and gills that result in a pharyngula, a developmental foundation shared by all vertebrates from fish to humans. Further shaping of the pharyngula by another set of genes adds limbs and other structures specific to terrestrial vertebrates. As these structures form, they start to take on "bird-specific" attributes, for instance the anterior limbs begin to form wings: however, most of these attributes form independently, for instance removing the genes for "wing" produce a bird with deformed wings - the rest of the bird remains intact. As each genetic program forms each tissue/structure, the "bird" is finally formed into a chick which hatches from the egg, and later grows into an adult crane.
Like the origami crane, the real crane starts with some basic steps that are common to all animals, and then further folding becomes more and more specific, until the final crane is made. Like origami, the process for forming a leg is the same for all birds: the final shape is defined by simple spatial cues like "fold further from the end for longer feet" or "stop growth early for shorter legs"
From the cellular perspective, this is even simpler. Each cell has several receptors that allow it to sense various cues in its environment. If a cell gets the signals "front" and "not center", it will turn on the genes for "eye". If a limb cell gets the signal "front", it will turn on the genes for "wing": however, the same limb cell transplanted to the back, where it gets the signal "back", will turn on the genes for "leg". It is through the summation of positional and temporal signals that the specific genes are activated that give cells their initial identities, and the continuous refinement of these signals and the addition of more restricted signals eventually forms each tissue of the embryo.
Try the links in the MadSci Library for more information on Development.