Development of the anterior pituitary gland ultimately leads to the appearance of five distinct cell types that are defined by the trophic hormones which they produce, providing an instructive model system for elucidating the molecular mechanisms that underlie the determination of distinct cell phenotypes within an organ from a common precursor lineage. The recent identification of several homeodomain transcription factors expressed specifically in the anterior pituitary gland has revealed a transcriptional cascade orchestrating a developmental program that leads to the determination of the five mature cell types. Recent data from gene-targeting experiments in mice further imply that the execution of this program is dependent on inductive signals originating in the floor of the diencephalon.