Photoreceptors, rods and cones are the most abundant cell type in the mammalian retina. However, the molecules that control their development are not fully understood. In studies of photoreceptor fate determination, we found that Blimp1 (Prdm1) is expressed transiently in developing photoreceptors. We analyzed the function of Blimp1 in the mouse retina using a conditional deletion approach. Developmental analysis of mutants showed that Otx2(+) photoreceptor precursors ectopically express the bipolar cell markers Chx10 (Vsx2) and Vsx1, adopting bipolar instead of photoreceptor fate. However, this fate shift did not occur until the time when bipolar cells are normally specified during development. Most of the excess bipolar cells died around the time of bipolar cell maturation. Our results suggest that Blimp1 expression stabilizes immature photoreceptors by preventing bipolar cell induction. We conclude that Blimp1 regulates the decision between photoreceptor and bipolar cell fates in the Otx2(+) cell population during retinal development.