The homeobox gene Six3 represses Wnt1 transcription. It is also required in the anterior neural plate for the development of the mammalian rostral forebrain. We have now determined that at the 15- to 17-somite stage, the prospective diencephalon is the most-anterior structure in the Six3-null brain, and Wnt1 expression is anteriorly expanded. Consequently, the brain caudalizes, and at the 22- to 24-somite stage, the prospective thalamic territory is the most-anterior structure. At around E11.0, the pretectum replaces this structure. Analysis of Six3;Wnt1 double-null mice revealed that Six3-mediated repression of Wnt1 is necessary for the formation of the rostral diencephalon and that Six3 activity is required for the formation of the telencephalon. These results provide insight into the mechanisms that establish anteroposterior identity in the developing mammalian brain.