Pax genes are expressed in specific patterns in the nervous system during development and in the adult. Recent findings suggest a link between the expression of Pax-2 and axonal guidance. Mice with a targeted deletion of Pax-2 are an excellent tool for studying axonal pathfinding at the molecular level, especially with respect to the optic chiasm. The date reviewed here suggest that Pax-2 regulates the expression of surface molecules involved in contact attraction and that the mutual regulation of the expression of Pax-2 and the Sonic hedgehog gene is of importance in the formation of the chiasm region.