The generation of distinct neuronal cell types in appropriate numbers and at precise positions underlies the assembly of neural circuits that encode animal behavior. Despite the complexity of the vertebrate central nervous system, advances have been made in defining the principles that control the diversification and patterning of its component cells. A combination of molecular genetic, biochemical, and embryological assays has begun to reveal the identity and mechanism of action of molecules that induce and pattern neural tissue and the role of transcription factors in establishing generic and specific neuronal fates. Some of these advances are discussed here, focusing on the spinal cord as a model system for analyzing the molecular control of central nervous system development in vertebrates.