The corpus callosum (CC) is the largest commissure in the forebrain and mediates the transfer of sensory, motor and cognitive information between the cerebral hemispheres. During CC development, a number of strategically located glial and neuronal guidepost structures serve to guide callosal axons across the midline at the corticoseptal boundary (CSB). Correct positioning of these guideposts requires the Gli3 gene, mutations of which result in callosal defects in humans and mice. However, as Gli3 is widely expressed during critical stages of forebrain development, the precise temporal and spatial requirements for Gli3 function in callosal development remain unclear. Here, we used a conditional mouse mutant approach to inactivate Gli3 in specific regions of the developing telencephalon in order to delineate the domain(s) in which Gli3 is required for normal development of the corpus callosum. Inactivation of Gli3 in the septum or in the medial ganglionic eminence had no effect on CC formation, however Gli3 inactivation in the developing cerebral cortex led to the formation of a severely hypoplastic CC at E18.5 due to a severe disorganization of midline guideposts. Glial wedge cells translocate prematurely and Slit1/2 are ectopically expressed in the septum. These changes coincide with altered Fgf and Wnt/β-catenin signalling during CSB formation. Collectively, these data demonstrate a crucial role for Gli3 in cortical progenitors to control CC formation and indicate how defects in CSB formation affect the positioning of callosal guidepost cells.