The nodal pathway acts upstream of hedgehog signaling to specify ventral telencephalic identity.

The Nodal and Hedgehog signaling pathways influence dorsoventral patterning at all axial levels of the CNS, but it remains largely unclear how these pathways interact to mediate patterning. Here we show that, in zebrafish, Nodal signaling is required for induction of the homeobox genes nk2.1a in the ventral diencephalon and nk2.1b in the ventral telencephalon. Hedgehog signaling is also required for telencephalic nk2.1b expression but may not be essential to establish diencephalic nk2.1a expression. Furthermore, Shh does not restore ventral diencephalic development in embryos lacking Nodal activity. In contrast, Shh does restore telencephalic nk2.1b expression in the absence of Nodal activity, suggesting that Hedgehog signaling acts downstream of Nodal activity to pattern the ventral telencephalon. Thus, the Nodal pathway regulates ventral forebrain patterning through both Hedgehog signaling-dependent and -independent mechanisms.