Recent studies have shown that persistent expression of FGF10 in the developing pancreas of transgenic mice results in enhanced and prolonged proliferation of pancreatic progenitors, pancreatic hyperplasia and impaired pancreatic differentiation. These studies have also suggested that FGF10 prevents the differentiation of pancreatic progenitors by maintaining persistent Notch signalling. Here, we provide experimental evidence sustaining the capacity of FGF10 to induce the proliferation of pancreatic precursors, while preventing their differentiation. Using explant cultures of E10.5 isolated dorsal pancreatic epithelium, we found that FGF10 maintained Notch activation and induced the expansion of pancreatic precursors while blocking their differentiation. In addition, by using a gamma-secretase inhibitor, we were able to down-regulate the expression of Hes1, a target gene of the Notch pathway in explant cultures of pancreatic epithelium treated with FGF10. In such explants, the effect of FGF10 on the proliferation and maintenance of pancreatic progenitors was suppressed. These results demonstrate that activation of the Notch pathway is required as a downstream mediator of FGF10 signalling in pancreatic precursor cells.