The anteriormost part of the neural plate is fated to give rise to the retina and anterior brain regions. In Xenopus, this territory is initially included within the expression domain of the bicoid-class homeobox gene Xotx2 but very soon, at the beginning of neurulation, it becomes devoid of Xotx2 transcripts in spatiotemporal concomitance with the transcriptional activation of the paired-like homeobox gene Xrx1. By use of gain- and loss-of-function approaches, we have studied the role played by Xrx1 in the anterior neural plate and its interactions with other anterior homeobox genes. We find that, at early neurula stage Xrx1 is able to repress Xotx2 expression, thus first defining the retina-diencephalon territory in the anterior neural plate. Overexpression studies indicate that Xrx1 possesses a proliferative activity that is coupled with the specification of anterior fate. Expression of a Xrx1 dominant repressor construct (Xrx1-EnR) results in a severe impairment of eye and anterior brain development. Analysis of several brain markers in early Xrx1-EnR-injected embryos reveals that anterior deletions are preceded by a reduction of anterior gene expression domains in the neural plate. Accordingly, expression of anterior markers is abolished or decreased in animal caps coinjected with the neural inducer chordin and the Xrx1-EnR construct. The lack of expansion of mid-hindbrain markers, and the increase of apoptosis in the anterior neural plate after Xrx1-EnR injection, indicate that anterior deletions result from an early loss of anterior neural plate territories rather than posteriorization of the neuroectoderm. Altogether, these data suggest that Xrx1 plays a role in assigning anterior and proliferative properties to the rostralmost part of the neural plate, thus being required for eye and anterior brain development.