Bone morphogenetic proteins (BMPs) are a rapidly expanding subclass of the transforming growth factor superfamily. BMP ligands and receptor subunits are present throughout neural development within discrete regions of the embryonic brain and within neural crest-derived pre- and post-migratory zones. BMPs initially inhibit the formation of neuroectoderm during gastrulation while, within the neural tube, they act as gradient morphogens to promote the differentiation of dorsal cell types and intermediate cell types throughout co-operative signaling. In the peripheral nervous system, BMPs act as instructive signals for neuronal lineage commitment and promote graded stages of neuronal differentiation. By contrast, within the CNS, these same factors promote astroglial lineage elaboration from embryonic subventricular zone progenitor cells, with concurrent suppression of the neuronal or oligodendroglial lineages, or both. In addition, BMPs act on more lineage-restricted embryonic CNS progenitor cells to promote regional neuronal survival and cellular differentiation. Furthermore, these versatile cytokines induce selective apoptosis of discrete rhombencephalic neural crest-associated cellular populations. These observations suggest that the BMPs exhibit a broad range of cellular and context-specific effects during multiple stages of neural development.