Enzymes that synthesize retinoic acid (RA) constitute the first level of regulation of RA action. In vertebrates, enzymes of the medium-chain alcohol dehydrogenase (MDR-Adh) family catalyze the first step of the RA synthetic pathway by oxidizing retinol. Among MDR-Adh enzymes, Adh3 is the only member present in non-vertebrates, and whether Adh3 is actually involved in RA biosynthesis remains uncertain. Here, we investigate the MDR-Adh family in Oikopleura dioica, a urochordate representing the sister group to vertebrates. Oikopleura is of special interest because it has lost the classical RA role in development, which relaxed evolutionary constraints to preserve the RA-genetic machinery, leading to the loss of RA-system components. The hypothesis that Adh3 plays a role in RA synthesis predicts that the relaxation of selection in Oikopleura should have led to the loss of Adh3, or changes in residues related to retinol oxidation. The hypothesis also predicts changes in the expression pattern of Oikopleura Adh3 compared to other chordates that preserved RA-signaling. Our results, however, revealed the presence of a highly conserved Adh3 gene in Oikopleura, with no significant changes in functional residues. Our results also revealed that the Oikopleura Adh3 expression remains unchanged in comparison to other non-vertebrate chordates, restricted to specific compartments of the digestive system. Because Adh3 has been highly conserved in an animal that has dismantled the RA system, we conclude that Adh3 preservation is not due to a conserved role in RA synthesis. Thereby, if Adh3 plays a role in RA synthesis in vertebrates, it might be a lineage-specific neofunctionalization.