Understanding homeobox gene specificity and function has been hampered by the lack of proven direct transcriptional targets during development. Dlx genes are expressed in the developing forebrain, retina, craniofacial structures and limbs. Dlx1/Dlx2 double knockout mice die at birth with multiple defects including abnormal forebrain development and decreased Dlx5 and Dlx6 expression. We have successfully applied chromatin immunoprecipitation (ChIP) to identify a direct transcriptional target of DLX homeoproteins from embryonic tissues in vivo. We optimized cross-linking conditions to enrich for protein-DNA complexes, then using specific high affinity DLX antibodies captured immunoenriched DLX genomic DNA transcriptional targets. DLX homeobox proteins bind differentially to the Dlx5/Dlx6 intergenic enhancer in newborn retina (DLX2) and embryonic striatum (DLX1, DLX2) in situ. Reporter gene assays demonstrated the functional significance of the binding of DLX proteins to this regulatory element, confirmed in vitro by electrophoretic mobility shift assays, using tissue extracts or recombinant DLX proteins. ChIP provides the best approach to identify direct Dlx homeoprotein targets from developing tissues in situ. The use of this technology will advance our understanding of Dlx gene function in the vertebrate in vivo and can be applied to examine targets of other homeobox genes and other classes of transcription factors.