During development of the Xenopus embryo, the formation of the nervous system depends on an inductive interaction between mesoderm and ectoderm. The result is a neural tube that is regionally differentiated along the anterior–posterior axis from forebrain to spinal cord (Fig. 1). The discovery of genes whose transcripts can be used as molecular markers for different regions of the nervous system has permitted reassessment of the existing theories of neural tissue formation. Although the neural inducing molecules remain elusive, the mechanism (...) by which cells interact to form a regionally differentiated nervous system is becoming clearer. (shrink)