Understanding the control of cell-fate choices during embryonic stem cell (ESC) differentiation is crucial for harnessing strategies for efficient production of desired cell types for pharmaceutical drug screening and cell transplantation. Here we report the identification of the zinc finger-like doublesex and mab-3-related transcription factor 5 (Dmrt5) as a marker for mammalian ventralmedial mesencephalic neuroepithelium that give rise to dopamine neurons. Gain-and loss-of-function studies in ESC demonstrate that Dmrt5 is critically involved in the specification of ventralmedial neural progenitor cell fate and the subsequent generation of dopamine neurons expressing essential midbrain characteristics. Genome-wide analysis of Dmrt5-mediated transcriptome changes and expression profiling of ventral-medial and ventral-lateral mesencephalic neuroepithelium revealed suppressive and inductive regulatory roles for Dmrt5 in the transcription program associated with the ventral-medial neural progenitor fates. Together, these data identify Dmrt5 as an important player in ventral mesencephalic neural fate specification.A major goal of embryonic stem cell (ESC) research is to direct the cells' differentiation toward specific cell types, especially those targeted by devastating degenerative diseases. The advent of induced pluripotent stem cell technology, with its promise for disease modeling, drug screening, and cell therapy, places further demand on a better understanding on the control of lineage/cell-fate specification from pluripotent stem cells. One neuronal cell type in particular, the midbrain dopaminergic (mDA) neuron, is a prime target in applied stem cell research because of its association with Parkinson's disease.The mDA neurons are generated in the floor plate (FP) region of the ventral midbrain and are uniquely identified by their coexpression of tyrosine hydroxylase (TH) with the mDA-specific homeobox protein Pitx3 (1, 2). During development, local inductive signals-Shh, FGF8, and Wnt1-induce distinct cell-fate potentials through initiation of transcriptional cascades that govern the subsequent differentiation, migration, and maturation of the ventral-most progenitors into mDA neurons (3-5). The distinct cell-fate potentials of ventral midbrain progenitors are defined by domain-identifiable expression of transcription factors. For example, the Lmx1a + Foxa2 + FP exclusively gives rise to mDA neurons, whereas the ventral-lateral domains marked by Meis2, Mab21l2, Helt, and Lhx1 produce glutamatergic or GABAergic neurons (6-9). Perturbation of such a transcription "code" seen in genetic studies often led to misspecification of progenitor identity and subsequently to neural transmitter phenotypes (10-12). These studies demonstrate the mechanism of cell-fate determination to be a balance of the activation of "specification" programs and the repression of alternative fates, as observed in the spinal cord (13). However, how transcription factors coordinate distinct fate choice in the ventral midbrain remains poorl...