Mammalian brain development requires coordination between neural precursor proliferation, differentiation and cellular organization to create the intricate neuronal networks of the adult brain. Here, we examined the role of the atypical cadherins Fat1 and Fat4 in this process. We show that mutation of Fat1 in mouse embryos causes defects in cranial neural tube closure, accompanied by an increase in the proliferation of cortical precursors and altered apical junctions, with perturbations in apical constriction and actin accumulation. Similarly, knockdown of Fat1 in cortical precursors by in utero electroporation leads to overproliferation of radial glial precursors. Fat1 interacts genetically with the related cadherin Fat4 to regulate these processes. Proteomic analysis reveals that Fat1 and Fat4 bind different sets of actin-regulating and junctional proteins. In vitro data suggest that Fat1 and Fat4 form cis-heterodimers, providing a mechanism for bringing together their diverse interactors. We propose a model in which Fat1 and Fat4 binding coordinates distinct pathways at apical junctions to regulate neural progenitor proliferation, neural tube closure and apical constriction.