Nieuwkoop's two-signal model proposed that induced neural tissue is inherently anterior (forebrain) in character and that a graded transforming (or posteriorizing) signal specifies posterior identity to the anterior neuroectoderm (Nieuwkoop 1952). It has been suggested that during vertebrate head development, the level of Wnt activity may specify posterior-to-anterior fates within the neural plate (Niehrs 1999; Heisenberg et al. 2001; Kiecker and Niehrs 2001). Wnt signaling must be inhibited to allow the development of the rostral telencephalon, or the prospective forebrain will acquire a caudal diencephalic identity (Niehrs 1999; Heisenberg et al. 2001; Kiecker and Niehrs 2001). This anterior Wnt-signaling-free zone is maintained by Wnt antagonists secreted by the anterior neuroectoderm and adjacent anterior mesendoderm (Niehrs 1999; Houart et al. 2002). Head truncations occur when genes that are required for the development of the anterior visceral endoderm (AVE; i.e., Hex, Lim1, and Otx2) are mutated (Thomas and Beddington 1996; Shawlot et al. 1999; Martinez-Barbera and Beddington 2001; Perea-Gomez et al. 2001). The lack of anterior head structures also occurs in mice that are double-homozygous for chordin and noggin, which encode secreted bone morphogenetic protein antagonists (Bachiller et al. 2000). In addition, mouse embryos lacking Dickkopf1 (Dkk1), a secreted protein that acts as an inhibitor of the Wnt coreceptor LRP-6, lack head structures anterior to the midbrain; Dkk1 activity is required in the axial mesendoderm (Mukhopadhyay et al. 2001). Variable forebrain truncations are also observed in mice with inactivating mutations in the homeobox gene Hesx1, whose activity is required in the anterior neural ectoderm (Martinez-Barbera and Beddington 2001). We have previously shown that in mice, Six3 is expressed in the most anterior part of the developing neural plate (Oliver et al. 1995). To determine the role of Six3 during vertebrate development, we inactivated the mouse Six3 locus. We find that Six3 is required for development of the mammalian rostral forebrain. The absence of Six3 results in forebrain truncations and posteriorization of the remaining mutant head. We demonstrate that Six3 binds to the Wnt1 promoter region in vivo and represses Wnt1 expression in the most anterior neuroectoderm. Work recently performed in zebrafish embryos has suggested that telencephalic induction, as well as the subsequent patterning of the forebrain into telencephalic, eye, and diencephalic regions, is the result of the graded expression of Wnt signaling in the anterior neural plate (Houart et al. 2002). Thus, during vertebrate head regional specification, the maintenance and refinement of anterior neural fates requires that Wnt signaling is transcriptionally repressed in the anterior neuroectoderm, and Six3 is a key player during this process. We also show that Six3 is sufficient to suppress the loss of forebrain resulting from excess Wnt1 signaling in headless (Tlc3) zebrafish mutants. Taken together, these results not only identified Six3 as a key player in vertebrate head development, but also demonstrated the existence of another regulatory step in the complex Wnt signaling pathway, the direct repression of Wnt1 expression by a transcription factor in the mammalian anterior neural plate at the late headfold–early somite stage, a step that is probably required for the maintenance of the anterior neural fates.