Individual classes of neural cells differentiate at distinct locations in the developing vertebrate nervous system. We provide evidence that the pattern of cell differentiation along the dorsoventral axis of the chick neural tube is regulated by signals derived from two ventral midline cell groups, the notochord and floor plate. Grafting an additional notochord or floor plate to ectopic positions, or deleting both cell groups, resulted in changes in the fate and position of neural cell types, defined by expression of specific antigens. These results suggest that the differentiation of neural cells is controlled, in part, by their position with respect to the notochord and floor plate.