The specification of neuronal fates in the ventral spinal cord depends on the regulation of homeodomain (HD) and basic-helix-loop-helix (bHLH) proteins by Sonic hedgehog (Shh). Most of these transcription factors function as repressors, leaving unresolved the link between inductive signaling pathways and transcriptional activators involved in ventral neuronal specification. We show here that retinoid signaling and the activator functions of retinoid receptors are required to pattern the expression of HD and bHLH proteins and to specify motor neuron identity. We also show that fibroblast growth factors (FGFs) repress progenitor HD protein expression, implying that evasion of FGF signaling and exposure to retinoid and Shh signals are obligate steps in the emergence of ventral neural pattern. Moreover, joint exposure of neural progenitors to retinoids and FGFs suffices to induce motor neuron differentiation in a Shh-independent manner.