The postnatal central nervous system (CNS) contains many scattered cells that express fibroblast growth factor receptor 3 transcripts (Fgfr3). They first appear in the ventricular zone (VZ) of the embryonic spinal cord in mid-gestation and then distribute into both grey and white matter - suggesting that they are glial cells, not neurones. The Fgfr3(+) cells are interspersed with but distinct from platelet-derived growth factor receptor alpha (Pdgfra)-positive oligodendrocyte progenitors. This fits with the observation that Fgfr3 expression is preferentially excluded from the pMN domain of the ventral VZ where Pdgfra(+) oligodendrocyte progenitors--and motoneurones--originate. Many glial fibrillary acidic protein (Gfap)- positive astrocytes co-express Fgfr3 in vitro and in vivo. Fgfr3(+) cells within and outside the VZ also express the astroglial marker glutamine synthetase (Glns). We conclude that (1) Fgfr3 marks astrocytes and their neuroepithelial precursors in the developing CNS and (2) astrocytes and oligodendrocytes originate in complementary domains of the VZ. Production of astrocytes from cultured neuroepithelial cells is hedgehog independent, whereas oligodendrocyte development requires hedgehog signalling, adding further support to the idea that astrocytes and oligodendrocytes can develop independently. In addition, we found that mice with a targeted deletion in the Fgfr3 locus strongly upregulate Gfap in grey matter (protoplasmic) astrocytes, implying that signalling through Fgfr3 normally represses Gfap expression in vivo.