In the developing mammalian central nervous system, neural precursor cells present in the ventricular zone determine their fate to become neurons or glial cells, migrate towards the outer layers and undergo terminal differentiation. The transcriptional repressor HES-1, a basic helix-loop-helix (bHLH) factor structurally related to the Drosophila hairy gene, is expressed at high levels throughout the ventricular zone, but the level decreases as neural differentiation proceeds. Because of this negative correlation, we tested whether continuous expression of HES-1 inhibits neural differentiation. A HES-1 and lacZ-transducing retrovirus (SG-HES1) and a control lacZ-transducing retrovirus (SG) were injected into the lateral ventricles of mouse embryos, and the fate of the infected neural precursor cells was examined by X-gal staining. The SG virus-infected cells migrated and differentiated into neurons and glial cells. In contrast, the cells infected with SG-HES1 virus remained in the ventricular/subventricular zone, decreased to approximately 10% in number as compared with that of the newborn during the postnatal 4-5 weeks and, when they survived, were present exclusively in the ependymal layer. Furthermore, whereas cultured neural precursor cells infected with SG virus became immunoreactive for neuronal and glial markers, the cells infected with SG-HES1 virus did not. These results show that persistent expression of HES-1 severely perturbs neuronal and glial differentiation.