The pituitary gland consists of two major parts: the neurohypophysis, which is of neural origin; and the adenohypophysis, which is of non-neural ectodermal origin. Development of the adenohypophysis is governed by signaling proteins from the infundibulum, a ventral structure of the diencephalon that gives rise to the neurohypophysis. In mouse, the fibroblast growth factors Fgf8, Fgf10 and Fgf18 are thought to affect multiple processes of pituitary development: morphogenesis and patterning of the adenohypophyseal anlage; and survival, proliferation and differential specification of adenohypophyseal progenitor cells. Here, we investigate the role of Fgf3 during pituitary development in the zebrafish, analyzing lia/fgf3 null mutants. We show that Fgf3 signaling from the ventral diencephalon is required in a non-cell autonomous fashion to induce the expression of lim3, pit1 and other pituitary-specific genes in the underlying adenohypophyseal progenitor cells. Despite the absence of such early specification steps, fgf3 mutants continue to form a distinct pituitary anlage of normal size and shape, until adenohypophyseal cells die by apoptosis. We further show that Sonic Hedgehog (Shh) cannot rescue pituitary development, although it is able to induce adenohypophyseal cells in ectopic placodal regions of fgf3 mutants, indicating that Fgf3 does not act via Shh, and that Shh can act independently of Fgf3. In sum, our data suggest that Fgf3 signaling primarily promotes the transcriptional activation of genes regulating early specification steps of adenohypophyseal progenitor cells. This early specification seems to be essential for the subsequent survival of pituitary cells, but not for pituitary morphogenesis or pituitary cell proliferation.