The Dmrt genes encode a large family of transcription factors whose function in sexual development has been well studied. However, their expression pattern is not restricted to the gonad, suggesting that Dmrt genes might regulate other developmental processes. Here, we report the expression and functional analysis of one member of this family: Xenopus Dmrt4 (XDmrt4). XDmrt4 is initially expressed in the anterior neural ridge and then becomes progressively restricted to part of the telencephalon and the olfactory placode͞epithelium. XDmrt4 is induced at the anterior neural plate by a balance of neural inducers and caudalizing factors. Interference with XDmrt4 function by injection of a morpholino oligonucleotide or an inhibitory mutant resulted in a similar phenotype, the specific disruption of the olfactory placode expression of Xebf2 without affecting the expression of other placodal markers. Xebf2 belongs to a family of helix-loop-helix transcription factors implicated in neuronal differentiation, and later in embryogenesis XDmrt4-deficient embryos show impaired neurogenesis in the olfactory epithelium. Consistent with this finding, XDmrt4 is sufficient to activate neurogenin, Xebf2, and neural cell adhesion molecule expression in animal explants and is required for Noggin-mediated neuralization. Altogether, these results indicate that XDmrt4 is an important regulator of neurogenesis in the olfactory system upstream of neurogenin and Xebf2.placode ͉ Xenopus ͉ Xebf2 ͉ forebrain ͉ neurogenin G enes related to the Drosophila doublesex and Caenorhabditis elegans mab-3 genes encode transcription factors conserved during evolution (1). They constitute the Dmrt (doublesex and mab-3-related transcription factor) gene family, a class of molecules characterized by a signature zinc finger-like DNA-binding motif known as the DM domain (2).Dmrt genes have been shown to regulate sexual development in arthropods, nematodes, and vertebrates and, as such, represent a rare example of genes whose function in sex regulation has been highly conserved during evolution (3). Dmrt1 was the first DM domain gene identified in vertebrates (4). In the mouse, Dmrt1 is expressed in the genital ridge, and upon sexual differentiation its expression decreases in the ovary and is maintained in the testis (4). Mice with a targeted deletion of Dmrt1 show normal development in XX individuals, whereas genetically male individuals have severely hypoplastic testes (5). In humans, DMRT1 maps to the short arm of chromosome 9, and hemizygous deletion of this region is associated with defective testicular development (6, 7). Dmrt1 has also been isolated in fish (8-13), amphibians (14), reptiles (15), and marsupials (16), and Dmrt1 expression pattern in these species is consistent with a role in testis differentiation.There is accumulating evidence from different phyla that more than one Dmrt gene could be involved in sexual development. For example, Dmrt3, Dmrt5, and Dmrt7 also exhibit sexually dimorphic expression in the early embryonic gonad (17). Conv...