Pigment cells are one of many cell types derived from the neural crest. This review focuses on the mechanisms that control the timing and pathways of migration of pigment cells into the epidermis and determinants that control the differentiation of pigment cells. Several factors may control the timing and pattern of pigment cell migration in the dorsolateral space including the loss of inhibitory molecules in the pathway, the appearance of chemotactic molecules emanating from the dispersing dermatome, and the differentiation of pigment cells, which may be the only neural crest derivative capable of utilizing the substratum found in the dorsolateral path. Control of pigment cell differentiation remains controversial. A working model presented in this review suggests that multipotent neural crest cells that disperse ventrally upon separation from the neural tube preserve neurogenic ability and lose melanogenic ability, whereas those cells that are arrested at the entrance to the dorsolateral path lose neurogenic ability so that the population becomes primarily melanogenic. During the time that the latter population is arrested in migration it is speculated that the neural crest cells are exposed to an environment comprised of specific extracellular matrix molecules and/or growth factors that enhance pigment cell differentiation.