Neural crest (NC) cells arise in the dorsal neural tube (NT) and migrate into the embryo to develop into many different cell types. A major unresolved question is when and how the fate of NC cells is decided. There is widespread evidence for multipotential NC cells, whose fates are decided during or after migration. There is also some evidence that the NC is already divided into subpopulations of discrete precursors within the NT. We have investigated this question in the mouse embryo. We find that a subpopulation of cells on the most dorsomedial aspect of the NT express the receptor tyrosine kinase Kit(previously known as c-kit), emigrate exclusively into the developing dermis,and then express definitive markers of the melanocyte lineage. These are thus melanocyte progenitor cells. They are generated predominantly at the midbrain-hindbrain junction and cervical trunk, with significant numbers also in lower trunk. Other cells within the dorsal NT are Kit–,migrate ventrally, and, from embryonic day 9.5, express the neurotrophin receptor p75. These cells most likely only give rise to ventral NC derivatives such as neurons and glia. The p75+ cells are located ventrolateral to the Kit+ cells in areas of the NT where these two cell types are found. These data provide direct in vivo evidence for NC lineage segregation within the mouse neural tube.