In 1960s, histological study on developing CNS led us to a novel finding that the periventricular layer (“Matrix” of W. His) of fetal neocortex is composed solely of the matrix cells. Application of 3H-thymidine autoradiography revealed “elevator movement” of the matrix cells. Following the stage of pure matrix cell proliferation (Stage I), stage of neuron production (Stage II) ensues, and when Stage II is over, stage of gliogenesis (Stage III) follows immediately; first, glioblasts, then astrocytes, oligodendrocytes and microglia differentiate, in sequence.As for the mechanism of the switching, recent progress in molecular research on dynamism of the chromatin and transcription-factors revealed the irreversible epigenetic changes controlling the switch. In Stage I of cytogenesis, axial ectodermal cells escape from irreversible differentiation into epidermis, and change into matrix cells composing the neural plate. In Stage II, some matrix cells, in which proneural genes are activated, exit cell cycle to become neurons. When Stage II ends, the neural-repressor REST/NRSBF is up regulated and occupies RE-1 silencer region to irreversibly inactivate neuron-specific genes including the type II Na+ channel, thereby matrix cells can now only produce non-excitable cells, i.e., glial cells. This is the Stage III of cytogenesis of the CNS.