Progenitor cells committed to eye development become specified in the prospective forebrain and develop subsequently into the optic vesicle and the optic cup. The optic vesicle induces formation of the lens placode in surface ectoderm from which the lens develops. Numerous transcription factors are involved in this process, including the eye-field transcription factors. However, many of these transcription factors also regulate the patterning of the anterior neural plate and their specific role in eye development is difficult to discern since eye-committed progenitor cells are poorly defined. By using a specific part of the Lhx2 promoter to regulate Cre recombinase expression in transgenic mice we have been able to define a distinct progenitor cell population in the forebrain solely committed to eye development. Conditional inactivation of Lhx2 in these progenitor cells causes an arrest in eye development at the stage when the optic vesicle induces lens placode formation in the surface ectoderm. The eye-committed progenitor cell population is present in the Lhx2(-/-) embryonic forebrain suggesting that commitment to eye development is Lhx2-independent. However, re-expression of Lhx2 in Lhx2(-/-) progenitor cells only promotes development of retinal pigment epithelium cells, indicating that Lhx2 promotes the acquisition of the oligopotent fate of these progenitor cells. This approach also allowed us to identify genes that distinguish Lhx2 function in eye development from that in the forebrain. Thus, we have defined a distinct progenitor cell population in the forebrain committed to eye development and identified genes linked to Lhx2's function in the expansion and patterning of these progenitor cells.