We report here the full-length sequence identification, molecular characterization, detailed demarcation expression analysis relevant to morphological marker genes and mapping of a bHLH transcription gene, referred to as Megane (Mgn). Mgn protein is structurally related to the neurogenic Drosophila hairy and Enhancer of split (h/E(spl)) proteins. The unique structural properties of Mgn factor in several characteristic residues define the gene as related to h/E(spl), but distinguish it from previously identified mammalian members of the family. Mgn is a single copy gene on mouse chromosome 8 and encodes a 27kDa protein that functions in the nucleus. First expression of Mgn is detected at mouse embryonic day 9.5 within the most rostral part of the cephalic flexure of the developing midbrain. Later, Mgn expression extends into other alar areas of the midbrain and forebrain, developmentally controlled in a regional specific pattern.