Six3 exerts multiple functions in the development of anterior neural tissue of vertebrate embryos. Whereas complete loss of Six3 function in the mouse results in failure of forebrain formation, its hypomorphic mutations in human and mouse can promote holoprosencephaly (HPE), a forebrain malformation that results, at least in part, from abnormal telencephalon development. However, the roles of Six3 in telencephalon patterning and differentiation are not well understood. To address the role of Six3 in telencephalon development, we analyzed zebrafish embryos deficient in two out of three Six3-related genes, six3b and six7, representing a partial loss of Six3 function. We found that telencephalon forms in six3b;six7-deficient embryos; however, ventral telencephalic domains are smaller and dorsal domains are larger. Decreased cell proliferation or excess apoptosis cannot account for the ventral deficiency. Instead, six3b and six7 are required during early segmentation for specification of ventral progenitors, similar to the role of Hedgehog (Hh) signaling in telencephalon development. Unlike in mice, we observe that Hh signaling is not disrupted in embryos with reduced Six3 function. Furthermore, six3b overexpression is sufficient to compensate for loss of Hh signaling in isl1- but not nkx2.1b-positive cells, suggesting a novel Hh-independent role for Six3 in telencephalon patterning. We further find that Six3 promotes ventral telencephalic fates through transient regulation of foxg1a expression and repression of the Wnt/β-catenin pathway.