The roof plate is a well known signaling center in CNS development, but its roles in the developing telencephalon and the common holoprosencephaly (HPE) malformation have been uncertain. Using cellular ablations in mice, we show that roof plate cell loss causes failed midline induction and HPE in the dorsal telencephalon. This morphologic phenotype is accompanied by selective deficits in midline gene expression and a reduced activity gradient for bone morphogenetic proteins (Bmps), the major signals produced by the roof plate. In dissociated cells and mutant explants, exogenous Bmp4 is sufficient to mimic roof plate selectivity in midline gene regulation and to rescue roof plate-dependent midline patterning. Previously unrecognized neuroanatomical defects predicted by the mouse model are then confirmed in human HPE patients. These findings establish selective roles for roof plate-dependent Bmp signaling in dorsal telencephalic patterning and HPE and define novel candidate genes for the human disorder.