Vertebrate cranial neurogenic placodes are relatively simple model systems for investigating the control of sensory neurogenesis. The ophthalmic trigeminal (opV) placode, for which the earliest specific marker is the paired domain homeodomain transcription factor Pax3, forms cutaneous sensory neurons in the ophthalmic lobe of the trigeminal ganglion. We previously showed that Pax3 expression in avian opV placode cells correlates with specification and commitment to a Pax3+, cutaneous sensory neuron fate. Pax3 can act as a transcriptional activator or repressor, depending on the cellular context. We show using mouse Splotch(2H) mutants that Pax3 is necessary for the normal neuronal differentiation of opV placode cells. Using an electroporation construct encoding a Pax3-Engrailed fusion protein, which represses Pax3 target genes, we show that activation of Pax3 target genes is required cell-autonomously within chick opV placode cells for expression of the opV placode markers FGFR4 and Ngn2, maintenance of the preplacodal marker Eya2, expression of Pax3 itself (suggesting that Pax3 autoregulates), neuronal differentiation and delamination. Mis-expression of Pax3 in head ectoderm is sufficient to induce FGFR4 and Ngn2 expression, but neurons do not differentiate, suggesting that additional signals are necessary to enable Pax3+ cells to differentiate as neurons. Mis-expression of Pax3 in the Pax2+ otic and epibranchial placodes also downregulates Pax2 and disrupts otic vesicle closure, suggesting that Pax3 is sufficient to alter the identity of these cells. Overall, our results suggest that activation of Pax3 target genes is necessary but not sufficient for neurogenesis in the opV placode.