In order to study anteroposterior neural patterning in Xenopus embryos, we have developed a novel assay using explants and tissue recombinants of early neural plate. We show, by using region-specific neural markers and lineage tracing, that posterior axial tissue induces midbrain and hindbrain fates from prospective forebrain. The growth factor bFGF mimics the effect of the posterior dorsal explant in that it (i) induces forebrain to express hindbrain markers, (ii) induces prospective hindbrain explants to make spinal cord, but not forebrain and midbrain, and (iii) induces posterior neural fate in ectodermal explants neuralized by the dominant negative activin receptor and follistatin without mesoderm induction. The competence of forebrain explants to respond to both posterior axial explants and bFGF is lost by neural groove stages. These findings demonstrate that posterior neural fate can be derived from anterior neural tissue, and identify a novel activity for the growth factor bFGF in neural patterning. Our observations suggest that full anteroposterior neural patterning may be achieved by caudalization of prospective anterior neural fate in the vertebrate embryo.