Despite extensive study following the pioneering work of Spemann on lens development (Spemann, H. (1901) Verh. Anat. Ges. 15, 61-79) and the subsequent establishment of the concept of embryonic induction, the molecular mechanism of vertebrate lens induction remains largely unknown. Here we report that in Xenopus expression of Pax-6 results in lens formation in a cell autonomous manner. In animal cap experiments, Pax-6 induced expression of the lens-specific marker beta B1-crystallin without inducing the general neural marker NCAM. Ectopic Pax-6 expression also resulted in the formation of ectopic lenses in whole embryos as well as in animal cap explants indicating that in vertebrates, as well as Drosophila (Halder, G., Callaerts, P., and Gehring, W.J. (1995) Science 267, 1788-1792), Pax-6 can direct the development of major components of the eye. Interestingly, ectopic lenses formed in whole embryos without association with neural tissue. Treatments giving rise to anterior neural tissue in animal cap explants resulted in the expression of both beta B1-crystallin and Pax-6. Given the ability of Pax-6 to direct lens formation, we propose that the establishment of Pax-6 expression in the presumptive lens ectoderm during normal development is likely to be a critical response of lens-competent ectoderm to early lens inducers.